Morocco

Revision of value-added tax (VAT) rates

The 2024 Finance Act introduced a gradual convergence towards two VAT rates (10% and 20%) over the period 2024 through 2026, as follows:

VAT exemptions

Finance Act of 2025 extended VAT exemption of fresh and  frozen meat to include seasoned meat, without the right to deduction.

VAT on digital operations

Finance Law 2024 expanded the scope of VAT to cover digital operations.

Services supplied remotely by a non-resident person with no establishment in Morocco to:

• a customer whose registered office, place of business, or tax domicile is in Morocco, or
• an occasional resident customer

are now subject to VAT.

A service provided remotely in a dematerialised manner is every service rendered via a remote communication tool, including intangible and other immaterial goods.

As part of aligning the provisions for remote services introduced by the Finance act 2024 with international best practices, the Finance act 2025 includes the following changes:

• Removing the scope of application for services provided remotely to an occasional resident client in Morocco, as this client will pay VAT on the transaction in their country of habitual residence;
• Defining criteria to establish tax residency in Morocco, to help non-resident companies identify clients covered by Article 115 bis of the MTC who acquire remote services digitally, by specifying clear indicators similar to those used in other countries;
• Changing the frequency for non-resident remote service providers to file their turnover declarations in Morocco, moving from monthly to quarterly filing through the electronic platform.

Revision of the corporate income tax (CIT) rates

The 2023 Finance Bill fixed the applicable CIT rates as follows:

• 20% for companies with net tax income lower than MAD 100 million.
• 35% for companies with net tax income equal to or higher than MAD 100 million (subject to some exceptions).

Still, the target rates of 20% and 35% rates will not be applicable until January 2026. As such, CIT rates will progressively evolve, from 2023 to 2026, as follows:

Social solidarity contribution (SSC)

The 2023 Finance Act extended the application of the SSC for corporate profits and professional income for the years 2023, 2024, and 2025.

The contribution is calculated as follows:

• For companies: Based on the same amount of net profit used for the calculation of CIT that is equal to or superior to MAD 1 million for the last closed fiscal year.
• For individuals: Based on the net income made that is equal to or superior to MAD 1 million as of the last closed fiscal year. 

SSC calculation method and applicable rates for companies

For companies, the SSC is calculated on the net taxable profit of the previous fiscal year according to the following proportional rates:

Companies subject to SSC must submit a declaration, by electronic means, according to a model established by the administration within three months following the closing date of the last accounting period. They must pay the amount of the contribution at the same time as the declaration referred to above.

WHT on dividends

The 2023 Finance Law introduced a reform on the WHT rate applicable to income from shares, units, and similar income that extends to 2026. Thus, the target rate of 10% will not be applicable until January 2026. As such, the WHT rate on dividends will progressively evolve, from 2023 to 2026.

In the context of simplifying the progressive application modalities of the WHT on income from shares, social shares, and similar income, the 2025 Finance Act has amended the provisions of Article 247-XXXVII-C to provide for the application of the withholding tax on said distributed income as follows:

• 12.50% for amounts distributed from January 1, 2025;
• 11.25% for amounts distributed from January 1, 2026;
• 10% for amounts distributed from January 1, 2027.

These rates apply to income from shares, social shares, and similar income distributed from January 1, 2025, regardless of the fiscal year of their origin.