Morocco 2027 Finance Bill and tax reforms

Moroccan Minister of Economy, Finance, and Public Performance, Fouzi Lekjaa, presented the 2027 Finance Bill to Parliament, focusing on reinforcing the social state and protecting citizen purchasing power. The budget aims to reduce the deficit to 3% of GDP while targeting a 4.7% economic growth rate. Key priorities include expanding health coverage, increasing direct social assistance, improving public education, and implementing a direct housing aid program.

Following the initial presentation, Minister Lekjaa detailed specific income tax reforms intended to alleviate the burden on the middle class and regular wage earners. Proposed changes include increasing the annual tax-exempt income threshold from 40,000 to 60,000 dirhams and reducing the number of tax brackets from five to three. These measures are expected to exempt approximately 87% of employees from income tax. To offset these reductions, the government plans to increase taxes on large corporations operating in monopolistic sectors, such as hydrocarbons. Companies in these sectors with revenues exceeding 100 million dirhams will see their tax rate rise from 35% to 40%.

During parliamentary debates within the Finance and Economic Development Committee, political groups expressed diverging views. Majority parties, including the Authenticity and Modernity Party and the Istiqlal Party, supported the bill, noting plans to increase monthly direct social support from 500 to 600 dirhams by 2027 and raise the minimum pension to 1,700 dirhams. Conversely, opposition members from the Justice and Development Party questioned the effectiveness of these measures against inflation. They raised concerns regarding market monopolies in the poultry sector and proposed importing livestock from Mauritania or establishing a slaughterhouse in the Guerguerat region to stabilize meat prices.