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The Moroccan tax code is quite straightforward. Here are some of the highlights.
The Value Added Tax (VAT) in Morocco is set at a standard rate of 20%. There are three reduced rates (7%, 10% and 14%) for specific products or services. Basic food staples, books and publications, certain loans and financial services are not subject to VAT.
Aside from the VAT, there are specific excise (consumption) taxes, for example on alcohol, tobacco, sugar, petrol products and others.
Morocco has signed free trade or tax treaties with over sixty countries worldwide, and this number increases every year. The latest status can be verified on the AMDI website. Morocco applies withholding taxes at the flat rate of 10% on dividends, interest payments and royalties. When a tax treaty exists, deductions may apply and the actual rate may be lower.
Capital gains are taxed at a 30% flat rate. Foreign companies can take advantage of numerous tax credits or subsidies (see chart below). The AMDI (Invest in Morocco investment promotion agency) can provide further details.
The following table summarizes the corporate tax scale:
Personal income tax
The table below provides the current scale applicable for personal income tax in Morocco:
There are several tax credits or possible deductions for foreign taxpayers in Morocco. It is best to consult with regional tax authorities or the central government for full details. For expatriates, there are no particular tax clauses, but Morocco has signed non-double taxation treaties with most countries.
Accounting and reporting
In Morocco, the fiscal year starts on January 1 and ends on December 31 of the same year. Moroccan companies are obliged to adopt IFRS accounting rules progressively.
Without going into full details, Moroccan accounting rules are inspired from French rules. Companies must prepare annual summaries of their accounts on the closing of the fiscal year based on the records kept in various ledgers (livre journal, grand livre and livre d’inventaire in French). The annual summaries must include balance sheet, accounts payable and receivable, profit and loss statement, cash flow statement, and additional information or notes.
“Although consolidated reporting is only mandatory for publicly-traded companies in Morocco, it is proving more and more useful for foreign companies having Moroccan subsidiaries,” explains Emmanuel Amon, managing director of Viareport, a French software company with operations in Morocco.
Audit and certification
The rules for auditing and auditors in Morocco were modified in 1999. External audits are required for joint stock companies (societe anonyme), for publicly listed companies and for LLCs (SARL) having annual revenues above MAD 50 million ($5.8 million). The audit must be led by a commissaire aux comptes (statutory auditors) and certain restrictions apply. For certain types of company, two statutory auditors are required. ●