Morocco’s Budget Deficit Narrows to 3.6% of GDP in 2019, VAT Arrears Remain High

According to l’Economiste, Morocco ended the year 2019 at 3.6% of GDP, compared to 3.8% a year earlier. This is the equivalent, in value, of a need of 41.7 billion dirhams, almost the same level as the VAT refund arrears: 41.2 billion dirhams at the end of December, specifies the same source.

The same newspaper notes that the deficit would be driven by the VAT credit arrears of companies. The General Treasury of the Kingdom (TGR) mentions a deficit of 46.7 billion dirhams in this regard.

According to the clarifications provided by the ministry, the Finance approach is to take into account the economic transactions carried out during a budgetary period, while that produced by the TGR has "a fundamentally accounting character".

As for ordinary revenue, it reached 249.9 billion dirhams, up 7.2%, and marked by a decline in CIT, PIT, urban and housing tax, as well as other direct taxes. As for the solidarity contribution on profits, it generated more than 2 billion dirhams with a concentration of corporate tax revenues estimated at less than 1% of companies that account for 80% of the revenue.