In general, Morocco has developed a strategy for attracting investment based on three fundamental freedoms: the right to invest, the right to transfer profits and the right to transfer divestment proceeds under certain conditions.
Economic reforms, social and legal implemented to secure and facilitate the installation of foreign investors, through two components:
(See website : www.manueldesprocedures.com)
The Investment Charter
The « Investment Charter » was adopted in 1995 to encourage foreign investors to establish themselves in the area and its principal incentives are as follows:
Any investment in excess of 200 million DH (18 million euros) has, in addition to tax benefits, exemption from duties and taxes on imports and of measures to promote regional development;
The Investment Charter
Thus, the legislator was keen to preserve two aspects:
As of twenty years ago, Morocco has undertaken important reforms with the objective of modernising the tax system and its adaptation to the demands of rapid economic growth and sustainable development.
These reforms were accompanied by a reduction in tax rates to bring them closer to international standards and focusing on two aspects:
Simplification, streamlining and modernising the tax system, notably by synthesising around the four main taxes:
On the other hand, the reduction of the tax burden through lower rates and broadening the tax base.
In general, the current tax incentives provide a large number of exemptions.
The treaty regime
To encourage investment and support some growth sectors of the economy, Morocco offers investors, whether domestic or foreign, a package of incentives, through the treaty regime.
It provides three types of special benefits granted to investors under the investment agreements or contracts to be concluded with the State, namely:
INVESTMENTS PROMOTION FUND
Companies that want to sign an investment contract with the State must meet one or more of the following:
Based on Article 17 of framework law No. 18-95 forming part of the Investment Charter, the Investments Promotion Fund (FPI) supports certain costs associated with land, external infrastructure and training, as follows:
HASSAN II FUND FOR ECONOMIC AND SOCIAL DEVELOPMENT
The Hassan II Fund provides financial support to investment projects within certain industrial sectors, pursuant to land acquisition, construction or acquisition of commercial buildings.
The sectors concerned are:
Any new investment project (creation or extension) with a total investment of more than 5 million dirhams (excluding import duties and taxes) and whose investment in equipment exceeds 2.5 million DH (excluding import duties and taxes).
Nature of the contribution
The financial contribution of the Hassan II Fund benefiting the same project, either pursuant to construction or acquisition of buildings, either as the acquisition of goods or, pursuant to the two sections at a time cannot exceed 10% of the total investment or the sum of 20 million dirhams.
ARTICLE 7.I OF THE FINANCE ACT No. 12/98
This article provides, for companies making an investment in excess of 200 million dirhams, an exemption from import duty and VAT on capital goods, materials and tools needed for their project and imported directly by these companies or on their behalf.
Exemption is also granted to the parties, for parts and accessories imported at the same time as capital goods, machinery and equipment for which they are intended.
Articles No. 92-I-6, No. 123 -22-B of the General Tax Code
Companies whose investment amount is equal to or greater than 200 million dirhams, are exempt from VAT on imports of capital goods, materials and tools needed for their projects.
The benefit of this advantage is conditional on the conclusion of an agreement with the state, the goods should be procured by the subject during a period of 36 months from the start of activity.
These four advantages are combined under a single investment project.
(For more information see the website of the Moroccan Agency for Investment Development: www.invest.gov.ma )