Morocco Intensifies Crackdown on Informal Economy to Boost Tax Revenue

The DGI classifies the informal economy into two distinct categories. On the one hand, the structural informal economy: this category includes players generating significant profits without contributing to the state’s tax revenues, thus causing considerable losses to the general treasury of the kingdom. On the other hand, the subsistence informal economy: this includes small activities that do not fall under organized tax evasion, modest activities and small savers with limited resources. The tax administration excludes the latter from coercive measures on the grounds that their potential tax contribution is negligible compared to the social costs of strengthening control.

In contrast to the structural informal economy, the subsistence informal economy encompasses small entrepreneurs and savers, and is more based on a logic of economic survival than on organized tax evasion. The objective of this new strategy to combat the informal economy is to optimize the efficiency of tax control while preserving social balance.

The fight against tax evasion involves the use of modern technologies, such as data analysis and the cross-checking of banking information, to identify informal players with significant financial flows, said Younes Idrissi Kaitouni, Director General of Taxes at a recent press conference on the tax measures of the 2025 Finance Act, stressing the need to find a balance between strengthening tax control and protecting vulnerable populations. According to his explanations, "excessive and unplanned tax pressure could generate social tensions." His wish is that the transition be done gradually in order to facilitate the integration of the informal sector into the formal economy.

"An activity with a turnover of more than 5, 6 or 10 million dirhams cannot be qualified as a subsistence activity," Kaitouni specified, estimating that these players benefit from the security and stability offered by the country without contributing to the tax resources, which makes them priority targets for tax control and corrective measures.