Key takeaway: The minimum contribution (cotisation minimale — CM) is a floor tax that every company subject to corporate tax (IS) must pay even when its taxable income is nil or negative. The standard rate is 0.25% since the 2023 Finance Law (Art. 144 CGI), reduced to 0.15% for essential consumer goods, with an absolute floor of MAD 3,000. Newly created companies are exempt for their first 36 months of activity.
What is the minimum contribution?
The minimum contribution is a fiscal mechanism established by Article 144 of the General Tax Code (CGI) that guarantees the State a baseline level of corporate tax revenue, regardless of the company’s financial performance. It acts as a tax floor: if the computed IS falls below the CM, the latter is payable instead.
This mechanism reflects the principle that any company conducting business in Morocco must contribute to public finances, even during periods of tax losses.
Minimum contribution rates in 2026
Since the reform introduced by the 2023 Finance Law, the CM rates have been revised:
| Category | CM Rate | Reference |
|---|---|---|
| Standard | 0.25% | Art. 144-I-D (Finance Law No. 50-22) |
| Essential consumer goods (regulatory list) | 0.15% | Art. 144-I-D (Finance Law No. 50-22) |
Products eligible for the 0.15% reduced rate: petroleum products, gas, butter, oil, sugar, flour, water, electricity, medicines.
Historical CM rate changes
| Period | Standard rate | Reference |
|---|---|---|
| Before 2019 | 0.50% | Former Art. 144-I |
| 2019 | 0.75% | Finance Law No. 80-18 (art. 7) |
| 2020-2021 | 0.50% | Finance Law No. 70-19 (art. 6) |
| 2022 | 0.40% (positive current result before depreciation) | Finance Law No. 76-21 (art. 6) |
| Since 2023 | 0.25% | Finance Law No. 50-22 (art. 6) |
Absolute floor
Regardless of the calculation result, the minimum contribution cannot be less than MAD 3,000 (Art. 144-I-D, last paragraph), even in the absence of any turnover. This absolute floor applies to all subject companies and must be paid in a single instalment, before the end of the 3rd month following the opening of the fiscal year (Art. 170-I, para. 3).
Calculation base
The CM base is broader than taxable income. It encompasses all revenue and products received by the company:
CM Base = Turnover (excl. VAT) + Ancillary income + Financial income + Subsidies and grants received
Specifically, the base includes:
- Turnover excluding VAT generated during the fiscal year
- Ancillary income: rental income, commissions, royalties, routine disposals
- Financial income: credit interest, foreign exchange gains, investment income
- Operating and balancing subsidies received
Excluded from the base:
- Capital gains on disposal of fixed assets (except routine disposals)
- Reversals of provisions and expense transfers
- Exceptional non-recurring income
This broad base explains why companies with significant turnover but low taxable income often owe the CM rather than the IS.
36-month exemption for new companies
Article 144-I-C-1° of the CGI exempts companies, other than public-service concession companies, from the minimum contribution for the first 36 months following the start of their operations. This exemption is doubly capped: it ceases to apply at the end of the first sixty (60) months following the date of incorporation of the company. A company that is slow to start operating therefore cannot postpone the benefit of the exemption indefinitely.
Key points:
- The exemption runs from the date of effective commencement of operations, not from the date of legal incorporation
- It applies automatically, without any special formality
- During this period, if the computed IS is positive, it remains payable
- The exemption covers only the CM as a floor; it does not waive IS actually owed
Professional tax advisory helps optimise this exemption period, particularly for companies launching with heavy initial investments.
CM vs. IS: the comparison mechanism
At year-end, the company performs a dual calculation:
- IS calculation: taxable income × applicable IS rate
- CM calculation: CM base × applicable CM rate
The higher amount is the tax effectively owed:
- If IS > CM → the company pays IS
- If IS < CM → the company pays CM
The definitive nature of excess CM
When the CM exceeds the IS, the excess can be neither offset, carried forward nor refunded: it is definitively retained by the Treasury. Since the 2016 Finance Act (Law No. 70-15), applicable to fiscal years beginning on or after 1 January 2016, the minimum contribution credit, which formerly allowed this excess to be offset against the IS of the following three fiscal years, has been abolished for IS purposes: Article 144-I-E of the CGI now provides for such offsetting only for personal income tax. The minimum contribution therefore operates as a definitive floor tax, not as a recoverable advance.
Example: A company pays MAD 50,000 CM while the computed IS is MAD 35,000. The MAD 15,000 difference is definitively retained by the Treasury and cannot be recovered in any subsequent fiscal year.
CM and provisional installments
The CM also plays a role in calculating provisional installments. Each quarterly installment equals 25% of the IS or 25% of the CM from the previous year, whichever is higher.
For its first fiscal year, a company pays no provisional installments at all: with no reference year, there is no prior tax to serve as a basis. The full amount of tax is paid at the time of the year-end settlement, when the tax return is filed.
For companies emerging from an exemption (the 36-month CM exemption, or a full IS exemption under Art. 6-II-B), Article 170-III requires a theoretical reference tax to be reconstituted for the first taxable year: the reference year is the last exempt year, and the installments are determined on the basis of the tax or minimum contribution that would have been due in the absence of any exemption, applying the rates in force for the current year.
| Situation | Installment base |
|---|---|
| Prior IS > Prior CM | 25% × prior IS |
| Prior IS < Prior CM | 25% × prior CM |
| First fiscal year | No installment due |
| First taxable year after an exemption | 25% × reconstituted theoretical tax (Art. 170-III) |
Worked example
Consider an LLC (SARL) with the following data for fiscal year 2026:
| Item | Amount (MAD) |
|---|---|
| Turnover (excl. VAT) | 4,000,000 |
| Ancillary income | 120,000 |
| Financial income | 80,000 |
| Subsidies received | 0 |
| Taxable income | 150,000 |
IS calculation: 150,000 × 20% = MAD 30,000
CM calculation: (4,000,000 + 120,000 + 80,000) × 0.25% = MAD 10,500
Since IS (30,000) > CM (10,500), the company pays MAD 30,000 in IS.
If taxable income had been MAD 20,000: IS = 4,000 < CM = 10,500 → the company would pay MAD 10,500 CM. The MAD 6,500 difference between the CM and the standard IS would be definitively retained by the Treasury.
Legal references: General Tax Code 2026 — Art. 144 (PDF) — Circular Note No. 717 — IS (Volume 1)
Frequently asked questions
Is the minimum contribution due when the company is in a loss position?
Yes. The CM is due even when taxable income is nil or negative, except during the first 36 months of activity. This is precisely its purpose: ensuring minimum tax revenue regardless of the result. Any excess CM over IS is definitively retained by the Treasury: it can be neither carried forward, offset nor refunded, the minimum contribution credit having been abolished for IS purposes since the 2016 Finance Act (Law No. 70-15, Article 144-I-E of the CGI).
What exactly is included in the CM calculation base?
The base includes turnover excluding VAT, ancillary income, financial income, and subsidies received. Capital gains on fixed asset disposals and provision reversals are excluded. The standard rate is 0.25% since the 2023 Finance Law (0.15% for essential consumer goods), with an absolute floor of MAD 3,000.
How does the CM interact with provisional installments?
Provisional installments are calculated on the higher of IS and CM from the prior year. Each installment represents 25% of this reference amount. Thus, even a company whose IS is lower than its CM pays installments based on the CM.
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