Morocco Cracks Down on Foreign Real Estate Tax Evasion Scheme

The audit missions focus on the analysis of land transactions and subdivisions in areas near major cities, mainly Casablanca and Marrakech. Carried out by notaries, these operations have complied with all the procedures relating to the transfer of ownership. But indicators of suspicion concerning tax evasion operations have been observed after examining the declarations of the real estate capital gains tax (TPI), report sources at Hespress. Part of the actual value of sales to foreigners has indeed been illegally transferred through the undervaluation of selling prices, thus reducing the amounts of taxes to be paid, and by receiving the other agreed amounts in European countries through intermediaries.

Three real estate developers, two in Casablanca and one in Marrakech, have been subjected to in-depth tax audits in a first phase. Involved in illegal foreign exchange operations, one of them is still the subject of an investigation by the exchange control services. They have gathered information on his links with suspicious bank transfers in France, made through an intermediary, in favor of a French citizen to whom he bought a property on the outskirts of the economic capital. She declared a fictitious sale amount to the exchange administration, which allowed her to obtain a transfer authorization to her account in her country.

This joint audit mission was triggered by specific information concerning the activities of intermediaries, who are the subject of investigations, who facilitate the outflow of funds abroad. It was discovered that these intermediaries have carried out cash transfers to entities in Morocco, against amounts received abroad by other entities, after deduction of often very high commissions. "Some have collected part of the value of real estate sales made in Morocco, not recorded in the sales contracts, directly from the buyers, but in Spain and France," the same sources revealed.