Morocco to Raise Tax-Free Income Threshold, Cut Income Tax Rates in 2025

The decision is in line with the implementation of the April 2024 social dialogue agreement. It aims to improve the incomes of civil servants, employees and retirees by reducing income tax. The Moroccan Executive plans to widen the other brackets and reduce the applicable tax rates, which will result in a 50% reduction in rates, as well as a decrease in the tax rate from 38% to 37%.

Also, the government is considering increasing the annual deduction amount for income tax on family burdens from 360 to 500 dirhams per dependent person of the taxpayer. In any case, the reduction should not exceed 2,160 to 3,000 dirhams for a maximum of 6 dependents.

A new category of taxable income should emerge. It concerns natural persons whose source of income is not justified, gains (in cash and in kind) from gambling, various income and gains resulting from operations intended to generate a profit and not classified in another category of income.

The Finance Bill also proposes to introduce a withholding tax obligation at the liberatory rate of 30% for gains from gambling, as well as for credit institutions and assimilated entities, or any person acting as an intermediary for the payment of online gambling winnings.