Morocco Revises Property Tax Laws: Key Changes for Homeowners and Businesses

The extension of the housing tax (TH), the commercial services tax (TSC) and the tax on unbuilt urban land (TNB) to subdivision operations are all provisions of draft law 07-20. The housing tax is fundamentally based on the rental value of the property. The new project has provided for raising the base by 2% every 3 years, instead of five years previously, as well as the exemption of main residences, reports L’Économiste.

"The rental value will consequently be revised every three years, also for the municipal services tax and the professional tax," said Mohamadi El Yacoubi, President of the Investment and Competitiveness Commission and the Legal Commission at CGEM Marrakech-Safi. The share of professional tax and housing tax revenue will be increased to 87%. In addition, a building permit will also be required before carrying out projects to restore buildings, rehabilitate non-compliant buildings and demolitions.

The Minister of the Interior also plans to review tax expenditures on local taxes. In addition, "the calculation method of TH, TSC and TP, exclusively oriented towards merchants, liberal professions and occupations not subject to IS, deserves to be simplified," stressed Mohamadi El Yacoubi. He did not fail to address the improvement of the collection of local taxes, the tax on motor vehicles and the tourist tax which will be extended to furnished rentals rented on the internet, especially on the Airbnb platform. Moreover, the annual census of land subject to tax will now be assigned to the president of the municipal council.

For the record, the draft law on local taxation comes before the adoption of the framework law on tax reform. Thus, the new tax measures will come into effect as of January 1, 2021, but in the meantime, the project will be voted on by the two chambers of Parliament, before the end of December.