Taxes has an important part in the Moroccan economy. The taxes are levied by the government and the organization responsible for tax policy on Morocco is called the “General Management of Taxes”.
The main taxes in Morocco
Today, Moroccan taxes are divided into 4 main parts: direct taxes, value-added taxes, registration fees and stamps.
Income tax
Income tax applies to the income and profits of natural persons and partnerships that have not opted for corporate income tax. Are concerned the incomes: Wages and assimilated; Professionals; Agricultural; Income and property profits; Income and profits from movable capital;
Housing tax
Corporate tax
The corporation tax is mandatory on the income and profits of corporations, public institutions and other legal entities that carry out lucrative transactions and irrevocable option to partnerships.
Tax rate for foreign companies
Moroccan tax applies territorially. Foreign companies are liable on Moroccan-sourced income if they have a permanent establishment in Morocco. There is an opt-in tax for qualifying activities of 8% of contract amount (see rate table), which requires the submission of a tax declaration before 1 April of each fiscal year. Otherwise, tax incentives apply equally to resident and foreign companies. Moroccan residency status applies if a company is incorporated in Morocco or its place of effective management is in Morocco.
Capital gains taxation
Capital gains derived from the disposal of immovable property generally are subject to a 20% tax. Higher rates are applicable in some specific cases. Capital gains derived from the disposal of shares are subject to tax at 20%. Capital gains derived from the disposal of a residence used as principal residence for at least six years are exempt from taxation.
Main allowable deductions and tax credits
Expenses incurred in connection with business activities are generally deductible unless specifically excluded. The development as well as incorporation expenses shall be capitalised and depreciated for tax purposes over a period of five years. Interest on loans granted by direct shareholders is deductible if the capital is fully paid in. Charitable contributions made by companies are deductible only if they are granted to foundations and societies explicitly provided by law. The contributions made to the community enterprise are deductible at up to 0.2% of the company turnover. Tax losses may be carried forward for a period of four years from the end of the loss-making accounting period. However, the portion of a loss that relates to depreciation may be carried forward indefinitely. The carry back of losses is not permitted. Foreign tax relief is provided for foreign-sourced income. Morocco offers tax incentives in the form of tax exemption or taxation at more advantageous rates for local and foreign investors. Newly incorporated companies are exempt from the business tax for a period of five years. Exporting companies and businesses operating tourism facilities (subject to certain conditions) are exempt from corporation tax for the first five years of activity and are subject to lower rates beyond that period. Certain companies established in free trade zones are exempt from the business tax for a period of 15 years, and from corporation tax during the first five years of activity (followed by a taxation at a rate of 8.75% after these five years for a period of 20 years).