In an increasingly competitive global context characterized by the implementation of binding universal tax standards, Morocco, like other emerging economies, is seeking to adapt its tax system to the new international environment in order to consolidate the attractiveness of its territory and the competitiveness of its companies.
In order to achieve this goal, tax authorities enabled industrial companies to benefit from a multitude of derogatory measures adopted during the last finance laws to correct the dissuasive effect produced by the common law: exemption or reduction of income tax, accelerated depreciation…
This article aims to summarize national tax measures that have a favorable impact on the industrial sector.
Industrial companies with a net profit of less than 100 MDH
In 2020, the marginal tax rate of 31% was reduced to 28% for companies carrying out an industrial activity with a net profit of less than 100 MDH.
Industrial activity is any activity that consists in manufacturing or directly transforming tangible movable goods through technical facilities, equipment and tools, whose role is preponderant.
For industrial companies carrying out an industrial activity and another activity, the rate of 28% and the above-mentioned MAD 100,000,000 threshold apply only to the portion of the profit corresponding to the industrial activity.
Non accumulation of benefits: The application of the above reduced rate cannot be cumulated with the application of degressive depreciation allowances or any other reduction. However, the company retains the right to choose the most advantageous incentive scheme.
Industrial companies located in industrial acceleration zones
The industrial acceleration zones (previously called Export Free Zone) benefit from a preferential tax regime through :
Measures concerning corporate tax:
– The five-year exemption from corporate tax from the start of operation, an advantage which is also granted to all industrial companies regardless of their geographical location at the national level;
– The application of the specific rate of 15% tax uniformly to the overall profit in terms of local turnover and export turnover from the sixth year following the five-year exemption period mentioned above;
It should be noted that prior to 2020, the reduced rate of 8.75% (raised to 15% by the LF 2020) applied only to export turnover realised by companies operating in this zone for a period of 20 years following the five-year exemption.
Exemption from withholding tax on dividends distributed by companies established in the industrial acceleration zones and originating from activities carried out in the said zones, when they are paid to non-residents.
Measures concerning VAT
Firms located in the industrial acceleration zones are exempt from VAT on products supplied to them and services rendered to them and on transactions carried out within or between the said zones.
Measures concerning Registration fees:
Firms located in Industrial Acceleration Zones are exempt from registration fees for :
– Acts of incorporation and capital increase.
– acquisition of land necessary for the implementation of their investment project
Non accumulation of benefits: The advantages granted to companies located in the industrial acceleration zones are exclusive of any other advantage provided for by other legislative provisions on investment promotion.
Industrial companies carrying out specific industrial activities
Industrial companies carrying out activities as detailed by a special decree benefit from total exemption from corporate income tax for the first five consecutive fiscal years from the date on which they begin operations.
It should be noted that in principle, this measure is applicable to industrial companies created from the date of publication of the 2017 Finance Act for investments made after that date;
However, decree no. 2-17-743 establishing the list of activities carried out by industrial companies benefiting from the above-mentioned temporary exemption from corporate income tax was not published until June 2018, which raises doubts as to the effective date of this measure.
Written by Imane BENABOUD TAX Manager