In brief: Taxation in Morocco is governed by the General Tax Code (CGI) and Law 47-06 on local taxation. The main taxes are Corporate Tax, Personal Income Tax, VAT, and Registration Duties, plus local taxes such as Professional Tax and Communal Services Tax.
Taxation in Morocco represents a major source of State revenue. Any person engaged in a profitable activity must pay taxes in Morocco.
Moroccan taxation comprises a set of taxes governed notably by:
- First, the General Tax Code
- Second, Law 47-06 on local taxation
- Third, Circular 717 of the Tax Administration and the various annual circulars
The rules governing taxation in Morocco are also based on case law arising from court decisions.
Taxation in Morocco - The General Tax Code
The General Tax Code is a law setting out the tax provisions applicable in Morocco. This code covers the following taxes:
- First, Corporate Tax (CT)
- Second, Personal Income Tax (PIT)
- Third, Value Added Tax (VAT)
- Finally, Registration Duties (RD)
Let us analyze each of these components of taxation in Morocco.
Corporate Tax (CT)
In Morocco, Corporate Tax is a tax applied to the profits of companies. Thus, the following entities are mainly subject to CT:
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First, LLCs: Limited Liability Companies
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Second, PLCs: Public Limited Companies and SAS (Simplified Joint-Stock Companies)
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Fourth, other legal entities with a profit-making purpose such as:
CT - Tax Base
Corporate Tax is applied to the net profit representing the excess of taxable income over deductible expenses.
Entities subject to CT must keep accounts in accordance with the standards in force in Morocco.
CT Rates
Furthermore, this tax is calculated according to a proportional scale. See CT in Morocco.
Withholding Taxes
Sometimes, tax in Morocco is collected by way of withholding at source. Regarding CT, this situation concerns notably:
- First, withholding tax on dividends;
- Second, withholding tax on interest paid;
- Finally, withholding tax on gross payments made abroad.
Personal Income Tax in Morocco (PIT)
Personal Income Tax (PIT) in Morocco primarily applies to the income of individuals.
In addition, it applies to the profits of companies that are not subject to CT. These include, in particular, limited partnerships and general partnerships.
PIT is applied according to the category of income. The following income categories are distinguished:
- First, salary income, which is taxed by way of withholding at source by employers;
- Second, real estate income and capital gains;
- Third, income and capital gains from movable capital;
- Fourth, agricultural income;
- Finally, professional income
Value Added Tax (VAT)
In Morocco, Value Added Tax (VAT) applies to the consumption of goods and services. Every merchant, manufacturer, industrialist, or service provider must apply VAT ad valorem to their sales.
Despite its broad scope, certain transactions remain outside its scope of application. These include notably:
- First, the agricultural sector
- Second, civil transactions (without a commercial purpose)
The standard VAT rate is 20%. Certain reduced rates are also provided for (7%, 10%, 14%).
Furthermore, VAT is due under a fractional payment model. Each merchant settles the VAT collected, after deducting the VAT on their purchases.
For more information, read: Value Added Tax in Morocco
In certain cases, a VAT credit may be refunded by the Administration. This applies, in particular but not exclusively, to exporting companies.
Other Topics Covered by the General Tax Code
The General Tax Code also covers other taxes and duties. These include notably:
- First, registration duties
- Second, stamp duties
- Third, the annual special tax on vehicles
- Finally, various social solidarity contributions
In addition, the General Tax Code lays the groundwork for tax audit procedures in Morocco.
Taxation in Morocco - Local Taxes
In addition to the taxes provided for by the General Tax Code, Law 47-06 establishes additional duties collected by local authorities. These include notably:
Professional Tax
The professional tax (formerly the business license tax) is a local tax owed by all merchants.
It applies to all forms of companies as well as branches. The professional tax is based on all the productive assets of the liable merchant.
Read for more information: Professional Tax in Morocco
Communal Services Tax, a Component of Taxation in Morocco
The communal services tax in Morocco is a local tax that was established in 2018. It replaced the former municipal tax.
The communal services tax is applied on an annual basis. The public treasury handles its collection on behalf of the municipalities.
The communal services tax applies to all built real estate of any kind. It also applies to other means of production falling under the professional tax.
Read for more information: Communal Services Tax
In addition, the Moroccan tax system includes other sector-specific local taxes, namely:
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First, specific taxes for the hotel sector (read: Hotel Taxation in Morocco). These include in particular:
First, the beverage sales tax;
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Second, the tourist tax;
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Then, specific taxes for other business sectors:
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First, the tax on undeveloped urban land;
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Second, the tax on construction operations;
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Third, the tax on subdivision operations;
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Fourth, the tax on mineral and table waters;
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Fifth, the tax on public passenger transport;
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Finally, the tax on quarry product extraction.
Tax Audit Procedures in Morocco
The General Tax Code establishes the framework for tax audit procedures. The Moroccan tax administration has the right to verify the accuracy of tax returns filed by taxpayers. Two main types of tax audits exist:
- Document-based review (controle sur pieces): the tax administration reviews the declarations and supporting documents submitted by the taxpayer without conducting an on-site visit. This is the most common form of review and can lead to reassessments if inconsistencies are identified.
- On-site audit (verification de comptabilite): the tax administration sends inspectors to the taxpayer’s premises to examine the accounting records, supporting documents and overall compliance with tax obligations. This audit must follow a strict procedural framework, including prior notification, a defined audit period (generally not exceeding six months for small companies and twelve months for larger entities), and the right of the taxpayer to respond to proposed reassessments.
Taxpayers who disagree with the conclusions of a tax audit may challenge the reassessment through an administrative appeal process. If the dispute remains unresolved, the taxpayer may bring the case before the administrative court. Understanding these procedures is essential for any business operating in Morocco.
International Tax Conventions
Morocco has signed over 60 double taxation agreements with countries across Europe, Africa, the Middle East and beyond. These conventions aim to eliminate double taxation and prevent tax evasion. They typically address the allocation of taxing rights on income categories such as dividends, interest, royalties, and capital gains between the source country and the country of residence.
For foreign companies operating in Morocco, these conventions can provide reduced withholding tax rates on payments made abroad and clarify the tax treatment of permanent establishments. Moroccan companies expanding internationally also benefit from these agreements by obtaining tax credits for taxes paid in foreign jurisdictions.
Notable conventions include those with France, Spain, the United Kingdom, the United States, the United Arab Emirates, and several West African nations. Companies engaged in cross-border transactions should carefully review the applicable convention to optimize their tax position and ensure compliance.
This guide was prepared by Upsilon Consulting, a chartered accounting firm in Casablanca with over 20 years of experience advising Moroccan and international businesses on taxation.
For your tax consultations or any other assistance, Contact Upsilon Consulting.
Find your corporate tax rate in seconds — Our free corporate tax calculator instantly determines the applicable rate, minimum contribution and CSS for your business in Morocco.
Frequently Asked Questions
What are the main taxes in Morocco?
The main taxes in Morocco are Corporate Tax (CT) on company profits, Personal Income Tax (PIT) on individual income, Value Added Tax (VAT) on goods and services consumption, and Registration Duties. These are governed by the General Tax Code. Additionally, local taxes such as the Professional Tax and Communal Services Tax are established by Law 47-06 on local taxation.
What is the standard VAT rate in Morocco?
The standard VAT rate in Morocco is 20%, applicable to the majority of goods and services. Reduced rates of 7%, 10%, and 14% apply to specific categories such as basic food products, pharmaceutical products, hotel services, and banking operations. The 2026 Finance Law continues the progressive reform to simplify rates toward two main rates.
How does the tax audit process work in Morocco?
Morocco has two main types of tax audits: a document-based review conducted from the tax authority’s offices without an on-site visit, and an on-site accounting audit where inspectors examine records at the taxpayer’s premises. On-site audits require prior notification, follow a defined period (six to twelve months), and the taxpayer has the right to respond to proposed reassessments and challenge them through administrative or judicial appeals.
Does Morocco have double taxation agreements?
Morocco has an extensive network of double taxation agreements with numerous countries, designed to prevent the same income from being taxed in both jurisdictions. These conventions typically provide reduced withholding tax rates on cross-border payments and clarify the tax treatment of permanent establishments. Notable agreements include those with France, Spain, the United Kingdom, the United States, the United Arab Emirates, and several West African nations. Companies engaged in international transactions should carefully review the applicable convention to optimize their tax position and ensure full compliance.
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