Morocco’s 2027 Finance Bill proposes raising the annual income tax exemption threshold from MAD 40,000 to MAD 60,000.
Presenting the bill to parliament last Friday, Economy and Finance Minister Fouzi Lekjaa said 87% of employees would be exempt from income tax from January 1, 2027. Most could gain around MAD 500 a month, while the measure is expected to cost the state MAD 5.5 billion.
New tax rates
The reform also changes the tax brackets. Under the 2027 proposal, annual income of MAD 60,001 to MAD 80,000 would be taxed at 10%, income of MAD 80,001 to MAD 100,000 at 20%, income of MAD 100,001 to MAD 180,000 at 34%, and income above MAD 180,000 at 37%.
The bill also raises the deduction for professional expenses to 45%, from 35% or 25%, depending on income, while the annual cap would remain MAD 35,000.
The reform will be introduced gradually until 2031, when the tax rates will be 10%, 20%, and 30%, and the highest rate will drop from 37% to 30%.
Who will benefit?
Public finance and tax law researcher Oussama Boughda told Hespress AR that the changes will not apply only to employees and salaried workers.
Under Article 73 of the General Tax Code, the new rates would also apply to professional income taxed under the actual or simplified net income system, as well as real estate income. But employees will remain the main group concerned.
National Social Security Fund (CNSS) figures for 2025 show that 91.8% of the 4,218,595 registered employees earned MAD 10,000 or less a month, while 344,058 earned more.
Simulated estimates of monthly gains
Boughda stressed that any rough estimate would remain general, as income tax is calculated differently depending on each person’s situation, saying that a married person with children, for example, has a different tax situation from a single person, and some employees’ compensation is included in their annual income.
He estimated that the monthly gain could start at around MAD 100 or slightly less and reach MAD 500 in 2027.
Boughda explained that the net income mentioned by Lekjaa refers to “gross monthly salary,” adding that the government’s example assumes a married employee with two or three children, who gets a MAD 600 tax deduction for each dependent, up to six dependents.
Under a simplified calculation for an employee without dependents, after social security and mandatory health insurance deductions, someone earning MAD 5,000 a month would see no change because they already pay no income tax.
Someone earning MAD 6,000 a month would gain MAD 16, while someone earning MAD 7,000 would gain MAD 149 as their income tax drops to zero.
The gain would be MAD 277 a month for a salary of MAD 8,000 and MAD 443 for MAD 10,000, increasing the net salary in the latter case from MAD 8,904 to MAD 9,346.
For salaries of MAD 12,000 or more, the monthly gain would be MAD 500, even for those earning MAD 50,000.
The gain would be smaller for employees with family members.
Someone earning MAD 8,000 and supporting three people would gain only MAD 127 because they already pay less tax.
Income tax would drop to zero for gross monthly salaries of around MAD 8,400 for employees without children, and MAD 9,900 for those supporting three peop
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