2020 started with a tax reform in Morocco. This should bring additional foreign investors into the country and create more transparency.
The 2020 Moroccan tax reform is distinguished by three main priorities:
continued support for social policies and reduction of social and territorial disparities
establishment of social protection mechanisms
confidence building and a new investment dynamic in addition to business support measures
The main changes introduced by the tax reform are:
Abolition of the five-year exemption for new exporting companies.
Companies established in industrial acceleration zones as well as service companies with “Casablanca Finance City” status will be taxed at the uniform rate of 15%, beyond the five-year exemption period.
Incorporated sports companies will benefit from the five-year exemption, from the first operating year.
Farms with a turnover of more than MAD 5,000,000 (MAD=Moroccan dirham. 100 dirham are the equivalent of around 10.5 USD, as of 2 March 2020), companies carrying out offshore activities, as well as sports companies benefit permanently from the marginal rate of 20% for the portion of net profit which exceeds MAD 1,000,000.
A new corporate tax scale is introduced.
We support foreign investors and companies in implementing the new tax rules in Morocco Nassim Karim, CPA – Certified Public Accountant (AE), Managing Partner, ECOVIS Morocco, Casablanca, Morocco
The new corporate tax scale is modified as follows:
Net Result in MAD
Less than or equal to 300,000
From 300,001 to 1,000,000
20% (instead of 17%)
Higher than 1,000,000
The higher rate of 31% is, however, reduced to 28% for companies exercising an industrial activity, excluding those whose net profit is equal to or greater than MAD 100,000,000.
The minimum contribution rate is set at 0.50%. However, this rate shall be increased to 0,60%, where, beyond the exemption period, current profit excluding depreciation is declared negative by the business for two consecutive financial years.
Measures relating to the voluntary regularisation of the taxpayer’s tax situation (unreported cash) and to the spontaneous regularisation of assets and liquids held abroad.
The administration may exchange information with foreign tax administrations under international conventions or agreements.
For further information please contact:
Nassim Karim, CPA – Certified Public Accountant (AE), Managing Partner, ECOVIS Morocco, Casablanca, Morocco