RABAT, (Reuters) – Morocco has drafted a budget for 2023 that plans higher taxes on banks and big firms as the government seeks additional revenue to cut its fiscal deficit and fund social protection programmes, Finance Minister Nadia Fettah Alaoui said.
The draft, which parliament must approve, aims to raise corporation tax over the next four years to 20% for firms with annual profits below 100 million dirhams ($9 mln) and 35% for those with profits over 100 million dirhams, while banks and insurers will pay a 40% tax, the minister told lawmakers.
Taxes on share dividends will be reduced over the next four years to 10% from 15% and the government plans to cut income taxes, she said.
It also plans to gradually impose a tax on products containing sugar “to protect the health of citizens,” she said.
Overall, the government expects tax and customs revenue to increase by 14.5% in 2023, helping narrow the deficit to 4.5% of gross domestic product from 5.3% expected this year and reduce government debt to 70% of GDP.
The 2023 budget also targets an economic growth rate of 4% from 1.5% expected this year, assuming an average harvest, and annual inflation of 2%.
Public investments will increase next year by 50 billion dirhams to 300 billion dirhams, the minister said.
(Reporting by Ahmed Eljechtimi; editing by John Stonestreet)
