Morocco’s Tax Revenues Shift: Corporate Tax Falls 13%, Personal Income Tax Rises

Overall, the gross tax revenues of the Directorate General of Taxes fell by around -1.5% at the end of March 2021. CIT fell by 13.2% against a double-digit increase in PIT revenues, notes Médias24. The total gross revenues stand at 46.3 billion DH against 47 billion at the end of March 2020. The DGI has achieved 31.5% of its tax target for the year 2021 which, according to the forecasts of the finance law, stands at 147.2 MMDH.

Significant drop in CIT

CIT revenues fell by 13.2% compared to March 2020. The drop in CIT revenues was predictable insofar as the CIT paid in March 2021 is borne on the profits made in 2020 where companies did not operate at full capacity due to Covid-19 which particularly affected the tourism ecosystem. This drop in CIT revenues is considerable compared to the tax collected in March 2021 compared to the same period in 2019. It is 31.6% or 4.2 billion less.

Unexpected rise in PIT

In contrast to the downward trend in CIT revenues, PIT revenues increased by 10.8% from 12.6 MMDH to almost 14 MMDH, according to Médias24. The increase in PIT may seem insignificant, insofar as the year 2020 was marked by a certain leniency on the part of the DGI towards companies, thus granting them a deferral or staggering of tax payments. As a result, the increase in PIT at the end of March 2021 is explained by a catch-up effect compared to 2020.

Stabilization of VAT

Domestic VAT has not experienced a significant variation. It maintained its level at 11.8 MMDH against 11.77 MMDH at the end of March 2020. However, compared to the pre-COVID 19 year, VAT revenues at the end of March 2021 are up 10.3%.