Morocco Considers Income Tax Reduction

The Moroccan government spokesperson, Mustafa Baitas, stated today, Thursday, that Morocco is considering a reduction in income tax in its budget for 2025 "to assist the middle class," amid repeated strike actions for improved wages. Baitas told reporters that the discussion on lowering income tax will take place in 2024, with implementation planned for 2025, without providing further details. Morocco imposes a progressive income tax rate of up to 38 percent on the salaries of workers in both the private and public sectors. Recent teacher strikes to advocate for better salaries have left public schools empty for several days, casting a shadow over the school year. The government has announced plans to begin phasing out support for cooking gas next year and will instead opt for direct cash assistance benefiting 60 percent of needy families. By 2026, the government aims to spend 50 billion dirhams (5 billion USD) on mandatory health coverage, financial aid for the needy, and housing assistance, financed by the state budget, solidarity tax, and the reallocation of subsidy funds. Despite increased spending on social safety nets, the government expects the fiscal deficit to shrink to 4 percent of GDP next year, down from the 4.5 percent forecast for this year.