EU Set to Remove Morocco from Tax Haven Watchlist

Barring any turnaround, Morocco should get off this "watchlist." It includes countries whose tax compliance commitments are deemed sufficient by the European Union, but whose implementation is currently being closely monitored.

For having complied with all the requirements in terms of compliance of its tax legislation, the government is reassured about the country’s exit from this list. Moreover, it has eliminated the incentive schemes of offshore banks, financial holdings, etc. through the 2019 Finance Act. The kingdom has also corrected two preferential tax regimes, namely those of the export processing zones and exporting companies through the 2020 Finance Act.

As for the exemption from corporate tax, it has been maintained for the first five years for companies established in the export processing zones (renamed industrial acceleration zones). Moreover, the rate has been increased from 8.75% to 15%, regardless of the destination of production (local or export market).

This Tuesday, February 16, the EU Finance Ministers should discuss the tax regime of Casablanca Finance City (CFC), considered "harmful" in October 2020 by Brussels. Last September, the government complied with this requirement by adopting in the Council of Government a decree-law reorganizing CFC. It has made it possible to modify the tax regime of companies having the CFC status. These reforms have already been welcomed by the Organization for Economic Co-operation and Development (OECD). Last November, the organization officially considered that Casablanca Finance City is now a non-harmful tax regime.