Casablanca – Starting January 2025, Morocco will implement significant fiscal and customs reforms under the 2025 Finance Law. These reforms aim to ease the tax burden on households, encourage investment, and modernize administrative practices.

Personal income tax (IR) adjustments

  • The income tax exemption threshold will increase from approximately $3,000 to $4,000, offering relief to taxpayers.
  • The marginal tax rate will be reduced to 37%, aiming for a more equitable distribution of the tax burden.
  • Deductions for dependents will rise to $52 per dependent, with an annual cap of $309 for larger families.
  • Daily meal vouchers for employees will increase from $3.09 to $4.12, with electronic payment options.
  • Retirees will move towards a full pension tax exemption by 2026, with a 50% reduction starting in 2025.

Corporate tax (IS) reforms

  • Businesses will benefit from adjusted tax-deductible depreciation allowances for passenger transport vehicles, enhancing competitiveness.
  • Tax incentives for corporate group restructurings will be eased, facilitating mergers and strategic reorganizations.

Value-added tax (VAT) exemptions

  • Temporary VAT exemptions will be granted for imports of live animals, fresh or frozen meats, and virgin and extra virgin olive oils, benefiting the agricultural and agri-food sectors.
  • Equipment for private education and vocational training will also be exempt, reducing costs and encouraging investment in education.
  • The share of VAT revenue allocated to local authorities will increase from 30% to 32%.

Registration fee revisions

  • Families of fallen soldiers and repatriated or injured military personnel will now be fully exempt from registration fees on gratuitous real estate transfers.
  • Notaries will be required to submit signed documents electronically, streamlining processes and reducing errors.

Administrative modernization

  • Electronic notifications will be legally equivalent to paper notifications, improving the efficiency of interactions between the tax administration and taxpayers.
  • Specific tax incentives will be provided to international entities like FIFA, highlighting Morocco’s ambitions to host major global events.

Dividend taxation changes

  • The withholding tax on dividends will gradually decrease from 12.5% in 2025 to 10% by 2027, enhancing Morocco’s financial market attractiveness and encouraging investment.

These reforms underscore Morocco’s efforts to balance support for households, incentives for businesses, and modernization of administrative practices to meet the nation’s structural challenges.