Morocco’s tax authority has launched a new offensive targeting businesses that have fallen completely off the fiscal radar for the past three years. In recent weeks, a number of companies received formal warnings urging them to officially shut down operations if they are no longer active.
According to the Moroccan General Directorate of Taxes, any company that fails to file tax returns or make payments for three consecutive fiscal years is deemed inactive—even if it still appears on the commercial register. Once a company hits that threshold, the tax office initiates an automatic assessment using whatever financial data is available. This can result in a rapid buildup of unpaid taxes and penalties.
Letting an inactive business linger may seem harmless, but it can lead to serious consequences. Any invoice issued or received by such an entity is immediately treated as non-deductible for tax purposes. Moreover, the company’s inactive status is now clearly flagged in the VAT filing system, making it easier for the authorities to detect these dormant operations.
These types of companies—legally alive but financially unresponsive—are seen as high-risk by the tax administration. Some are suspected of being used for fraudulent schemes, such as generating fake invoices to manipulate tax filings. That’s why the authorities are tightening their grip on this growing problem.
If any taxable activity is spotted—no matter how minor—or if there’s any sign that business operations are resuming, the company is immediately moved back to the active list, triggering a full-scale tax reassessment. This process is governed by Article 228 bis of Morocco’s General Tax Code, which lays out the steps tax officials must follow when reactivating and auditing a previously inactive entity.
The crackdown typically begins with a notice giving the business 30 days to get its house in order. If there’s no response, a second letter outlines the tax amount the authorities intend to collect, along with any penalties. At that point, the assessment becomes automatic. However, companies still have the chance to come forward voluntarily and settle their status before harsher measures are applied.
Strict adherence to the rules and timelines is essential. Any decision to resume operations must be formally declared in writing. Similarly, businesses that are closing for good must file an official cessation notice—required under Article 150 of the Tax Code—within 30 days of receiving the form. In reality, administrative delays often lead to disputes over the official shutdown date, which can complicate matters further.
If a company fails to respond within the required timeframe, it is officially listed as inactive. While the automatic tax assessment may be temporarily paused, the file remains active, and tax officials are ready to move forward as soon as new information comes to light.
