Amended corporate income tax (CIT) rate
Finance Bill 2020 raised the CIT rate applicable to the intermediate taxable income ranging from 300,001 Moroccan dirhams (MAD) to MAD 1 million from 17.5% to 20%. Consequently, the Moroccan CIT is levied at the following updated rates, using a progressive rate scale:
|Taxable income (MAD)||CIT rate (%)|
- The rate of 20% is also applicable to the portion of the taxable profit above MAD 1 million for some companies, such as exporting companies, mining companies, companies carrying out service outsourcing activities inside or outside the industrial integrated platforms devoted to those activities, etc.
- The rate of 31% is reduced to 28% for companies holding an industrial activity with a net profit of less than MAD 100 million.
- The rate of 37% remains applicable to credit institutions and assimilated organisations, insurance and reinsurance companies, as well as to Takafoul insurance and reinsurance companies and funds.
These provisions are applicable to fiscal years beginning open as of 1 January 2020.
Suppression of the five-year export exemption
The Finance Act for 2020 abrogated the five-year export exemption applicable to the exportation turnover.
Starting from 1 January 2020, exportation turnover benefits from taxation at the rates of 10% and 20% above MAD 300,000.
Taxation at the above-mentioned rates also applies to the turnover realised for sales of products to companies located in the industrial acceleration zones under some conditions.
- Companies that carry out the first exportation operation as of 1 January 2020 will no longer benefit from the five-year exemption.
- Companies that have carried out the first export before 1 January 2020 will continue to benefit from the total exemption until the expiry of the five-year exemption period.
Decrease of the standard rate of minimum contribution
The minimum contribution rate has decreased from 0.75% to 0.50%.
However, it is increased to 0.6% when, beyond the 36-month exemption period, the current result excluding amortisation is declared negative for two consecutive fiscal years.
This provision is applicable to CIT returns filed as of 1 January 2020 (taking into account tax deficits for fiscal years prior to 1 January 2020).
Establishment of country-by-country (CbC) reporting
The Finance Act of 2020 has introduced CbC reporting .
The relating information will be exchanged automatically, subject to reciprocity, with the tax authorities of countries that have concluded a convention or agreement to this effect.
The filing obligation of the CbC report applies to a company established in Morocco when it meets the following criteria:
- It directly or indirectly holds an interest in one or more companies or establishments located outside Morocco which requires from the Moroccan entity to prepare consolidated financial statements in accordance with applicable accounting standards or which would be required to do so if its interests were listed on the Moroccan stock exchange.
- Its consolidated annual turnover before tax is equal to or greater than MAD 8,122,500,000 for the financial year preceding the one concerned by the declaration.
- It is not owned directly or indirectly by any other company located in Morocco or outside Morocco.
The filing obligation might also apply in some other situations.
A penalty of MAD 500,000 applies for not filing the CbC report or for filing it out of the due date.
This provision becomes effective for fiscal years beginning on or after 1 January 2021.