The proposed 2025 Finance Bill (PLF 2025) introduces several significant fiscal measures, aimed at easing income tax burdens, supporting public sector reforms, and enhancing the efficiency of tax collections. Here’s a breakdown of the main proposals included in the bill:
Regarding income tax, the proposed adjustments include a notable change in the progressive income tax brackets. The threshold for net income exempt from tax is set to rise from 30,000 MAD to 40,000 MAD annually. This adjustment ensures that monthly wages below 6,000 MAD will no longer be subject to income tax. Additionally, other income tax brackets will be expanded, and their respective rates will be reduced, offering a substantial decrease in tax burdens by up to 50%. The top marginal tax rate is also set to decrease from 38% to 37%, providing further relief to high-income earners.
The bill also proposes an increase in the annual deduction for family allowances, raising the amount from 360 MAD to 500 MAD per dependent, giving families more tax relief. Furthermore, the conditions for exempting internship allowances from taxation will be revised to better accommodate young professionals. Changes to the property income tax regime are also proposed, aiming to create a more favorable tax environment for rental income.
New categories of taxable income will be introduced. These include income derived from unjustified personal wealth uncovered during fiscal audits, gambling winnings, and various profitable transactions that do not fit into existing taxable categories. Additionally, the fiscal treatment of pension buybacks, particularly those whose contributions have not been deducted, will also be reviewed.
The bill will clarify how profits from expropriation cases involving illegal possession of land will be taxed, ensuring a clearer understanding of the tax obligations in such cases.
For value-added tax (VAT), temporary exemptions will be applied to certain transactions involving live animals and agricultural products. Moreover, the portion of VAT revenue allocated to local governments will increase from 30% to 32%, ensuring more resources for regional development.
Regarding registration duties, several clarifications and adjustments are proposed. The fiscal treatment of leases exceeding ten years in duration will be outlined more clearly. A sanction will be introduced for professionals who fail to complete electronic registrations as required, and notaries will be obliged to electronically submit documents that contain digital signatures. Property registrars will also be prohibited from accepting documents not accompanied by proof of tax registration issued by the tax administration. Additionally, exemptions from registration duties will be extended to the transfer of real estate properties given freely to the families of martyrs, wounded soldiers, and repatriated or defected military personnel.
Among common measures, the bill introduces a tax incentive regime for FIFA’s representations in Morocco, a provision that aims to foster international sporting events in the country. It also brings joint-stock partnerships (SEP) with more than five partners, or with at least one legal entity, into the corporate tax regime.
Electronic notifications from the tax administration will have legally binding consequences under the bill, adding clarity to the legal status of such communications. Furthermore, procedures for amicable agreements between taxpayers and the tax administration will be better regulated to ensure fairness and transparency during fiscal negotiations.
The Finance Bill also focuses on codifying certain parafiscal taxes, such as incorporating the special cement tax into the General Tax Code, streamlining the tax structure.
In terms of budgetary provisions, the Finance Bill outlines a residual financing need of 63.51 billion MAD for 2025, a slight decrease from the previous year. Total expenditures are expected to surpass 721.31 billion MAD, compared to revenues projected at 657.8 billion MAD. This shortfall reflects the state’s commitment to maintaining fiscal discipline while accommodating necessary spending increases.
The bill also includes plans to create 28,906 new government positions, distributed across various ministries and institutions. The Ministry of the Interior will receive the largest allocation with 7,744 new positions, followed by the Ministry of Health and Social Protection with 6,500 positions, and the National Defense Administration with 5,792 positions. An additional 500 positions will be reserved for the office of the Prime Minister, 200 of which will be allocated to individuals with disabilities.
In education, 600 new positions will be created to regularize the status of employees with doctoral degrees, in line with agreements reached between the government and education unions in December 2023. These new positions will be distributed among academic staff who passed competitive examinations to enter the corps of teaching researchers. The posts held by these individuals prior to their regularization will be eliminated.
Moreover, as part of ongoing healthcare governance reforms, the Finance Bill provides for the transfer of staff working in decentralized health services to newly established regional health groups under Law No. 08-22. Until December 31 of the transition year, these employees will remain on the general state payroll. From January 1 of the following fiscal year, they will be transferred to the budgets of the regional health groups, and their previous positions in the ministry will be abolished.
The same process applies to personnel working in Morocco’s National Blood Transfusion Center, regional transfusion centers, and blood banks, which will be transferred to the Moroccan Blood and Derivatives Agency under Law No. 11-20. Similar measures will apply to staff in the Directorate of Medicines and Pharmacy, who will be transferred to the newly created Moroccan Agency for Medicines and Health Products.
Finally, the bill anticipates the creation of 16,000 new positions in the Regional Academies of Education and Training, with 14,000 of these for hiring teachers and 2,000 for recruiting administrative and pedagogical support staff.
The total expenditures under the 2025 budget show an increase of 13.01% compared to the previous year, while revenue is expected to grow by 14.49%. Despite this, the overall budget deficit is projected to slightly increase, with a negative balance of 126.36 billion MAD, compared to 124.75 billion MAD in 2024.
