As part of the 2025 finance bill (PLF 2025), the Finance Committee of the House of Representatives has decided to maintain the new income tax (IR) rates proposed by the government without making any changes. This decision follows several parliamentary debates where amendments were suggested, but the original text was kept as is.
The government, during its discussions with parliamentarians, reaffirmed the importance of this tax reform, which is part of the social commitments made in the social dialogue agreement of April 2024. This agreement aims to improve salary conditions of civil servants, employees and retirees. The Minister Delegate in charge of the Budget, Faouzi Lekjaa, specified that the total cost of this reform is estimated at 5.2 billion dirhams (billion dirhams).
Objectives of the reform: expanded tax exemptions
This reform, beyond its financial impact, aims to reduce the tax burden for a large part of the population. According to the government, the share of tax exemptions benefiting private sector employees will increase from 70.1% to 80.3%, while for public sector civil servants, it will increase from 36.8% to 46.7%. With regard to retirees, the reform could allow an increase in the share of exemptions, reaching 95.9%, compared to 90.9% currently.
This reform is part of framework law No. 69.19 on tax reform, which seeks to broaden the tax base while reducing the burden on taxpayers, an objective which seems to be reinforced by the measures taken in the PLF 2025.
It should be remembered that at the heart of this reform is a rearrangement of the IR scale, which provides for several tax relief measures. Raising the exemption threshold from 30,000 to 40,000 dirhams will make it possible to exempt all salary income below 6,000 dirhams per month. This change marks notable progress for low-income households, offering them a breath of fresh air in the face of rising living costs.
For employees whose net taxable income is between 8,333 and 15,000 dirhams, the tax savings could reach up to 400 dirhams. These adjustments aim to reduce the tax burden while maintaining higher tax rates for higher incomes, thus ensuring a certain tax fairness.
Details of the new scale
The new IR scale is as follows:
Net annual taxable income up to 40,000 dirhams: exempt
Bracket from 40,001 to 60,000 dirhams: rate of 10%
Bracket from 60,001 to 80,000 dirhams: rate of 20%
Bracket from 80,001 to 100,000 dirhams: rate of 30%
Bracket from 100,001 to 180,000 dirhams: rate of 34%
Beyond 180,000 dirhams: rate of 37%
These changes will not only reduce the marginal rate for certain taxpayers, but also support large families by increasing deductions for dependents, from 360 to 500 dirhams per dependent.
Concrete impact of this reform
Simulations were carried out by several accounting firms to illustrate the concrete impact of this reform on various employee profiles. Here are some examples:
For an employee with a monthly net taxable salary of 5,000 dirhams:
Current tax: 333.33 dirhams
New tax: 166.67 dirhams
Tax savings: 166 dirhams
For an employee whose net taxable salary is 8,333 dirhams:
Current tax: 466.67 dirhams
New tax: 66.67 dirhams
Tax savings: 400 dirhams
For an employee with a net taxable salary of 10,000 dirhams:
Current tax: 583.33 dirhams
New tax: 233.33 dirhams
Tax savings: 350 dirhams
For an employee earning 20,000 dirhams:
Current tax: 1,050 dirhams
New tax: 600 dirhams
Tax savings: 450 dirhams
For a salary of 30,000 dirhams:
Current tax: 1,600 dirhams
New tax: 1,050 dirhams
Tax savings: 550 dirhams
For a salary of 40,000 dirhams:
Current tax: 2,150 dirhams
New tax: 1,500 dirhams
Tax savings: 650 dirhams
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