CONTINUEThis site uses cookies. By continuing to browse this site you are agreeing to our use of cookies. Find out more.
  1. Front Page
  2. News By Topic
  3. Moroccan Budget Minister Defends Tax Reform Plans

Moroccan Budget Minister Defends Tax Reform Plans

by Ulrika Lomas,, Brussels

04 November 2013

Moroccan Budget Minister Driss El Azami El Idrissi has defended the country's draft budget for 2014, insisting that the legislation will swiftly implement the Government's tax reform plans as part of efforts to promote growth and employment, and to boost the attractiveness and competitiveness of Morocco.

In an interview with Le Matin, Budget Minister Driss El Azami El Idrissi emphasized that taxation forms the heart of next year's finance bill, which seeks to improve state revenue levels as advocated during the recent conference on taxation. The Government has therefore determined that no new tax exemptions will be accorded in 2014 and has pledged to progressively abolish existing exemptions, based on their economic utility.

The Government's 2014 finance bill provides notably for a "progressive taxation" of the agricultural sector in Morocco from next year, hitherto exonerated from tax, while maintaining the tax exemption exclusively for small- and medium-sized agricultural businesses.

Consequently, from January 1, 2014, agricultural companies realizing a turnover equal to or in excess of MAD35m (USD4.2m) will be subject to taxation. From January 1, 2016, farmers with a turnover equal to or above MAD20m will be taxed, while the turnover threshold will be further lowered to MAD10m in 2018, and finally to MAD5m from 2020.

Furthermore, the draft budget for next year provides for a reform of the value-added tax (VAT) system. The reform is intended to widen the base of the tax over the course of the next two years, by abolishing exemptions that are no longer justified and by aligning and reducing the number of VAT rates to two.

From next year VAT rates of 10 percent and 20 percent will apply. Those products currently subject to VAT at 7 percent, namely canned sardines and food used for livestock feed, are to be taxed at 10 percent, while products currently subject to a 10 percent rate of VAT (salt and milled rice) and to a 14 percent rate (food fats and margarine) will be subject to VAT at 20 percent.

Finally, to simplify existing legislation and to reduce the tax burden on economic operators, the bill provides that for operations realized with non-residents, the purchaser or acquirer will be liable for VAT, via the introduction of a reverse charge regime.

Both chambers of parliament are currently examining the 2014 finance bill.

TAGS: Morocco | VAT rates | tax | business | value added tax (VAT) | mining | budget | corporation tax | food | legislation | tax rates | tax breaks | tax reform

To see today's news, click here.


Tax-News Reviews

Cyprus Review

A review and forecast of Cyprus's international business, legal and investment climate.

Visit Cyprus Review »

Malta Review

A review and forecast of Malta's international business, legal and investment climate.

Visit Malta Review »

Jersey Review

A review and forecast of Jersey's international business, legal and investment climate.

Visit Jersey Review »

Budget Review

A review of the latest budget news and government financial statements from around the world.

Visit Budget Review »

Stay Updated

Please enter your email address to join the mailing list. View previous newsletters.

By subscribing to our newsletter service, you agree to our Terms and Conditions and Privacy Policy.

To manage your mailing list preferences, please click here »