Morocco Cracks Down on Real Estate Tax Evasion, Targets Developers

Trouble is in store for real estate developers who do not pay the tax on unbuilt land (TNB). Instructions have been given at the provincial and prefectural levels to update the lists of persons liable to the TNB in the various cities of the kingdom, after the Ministry of the Interior found that land located within the urban perimeter of several cities is not affected by the TNB, because their owners have benefited from a suspensive exemption from this tax, reports Assabah. Another finding: the issuance of an abnormal number of permits for agricultural activities in the urban perimeter of several cities, leading to the exemption of these lands from the TNB.

Some commune presidents have requested the sending of inspection missions to their communes in order to investigate the flagrant irregularities noted by inspection commissions in the minutes relating to the tax on unbuilt land (TNB) to the benefit of real estate developers. They have also requested that these commissions carry out an audit of the contracts concluded by their communes, particularly those relating to the rental of the communal heritage. While these contracts, together with the TNB, constitute an important financial resource for the communes, the collection is tainted by several irregularities noted in the reports of the Regional Courts of Accounts.

Some commune presidents are also in the sights of the Ministry of the Interior. These are the ones whose "complicity will have been proven in these cases of undue exemption from the TNB." This is a "tax evasion offense punishable by law," which would cost them dearly. In addition to being removed from their duties, they could be prosecuted in court.