Big Moroccan Companies Evade Taxes Using Fake Addresses in Southern Provinces

Morocco’s General Directorate of Taxes has discovered a new tax evasion trick that several big companies have opted for, revealing that many firms have been using fictitious addresses in the country’s southern provinces while carrying out their business activities outside of the regions.

Rabat – Morocco’s General Directorate of Taxes has discovered a new tax evasion trick that several big companies have opted for, revealing that many firms have been using fictitious addresses in the country’s southern provinces while carrying out their business activities outside of the regions.

Several companies, in Morocco and across the world, set up what is known as “shell companies,” which exist on paper only, to reduce tax bills. They do so by using a fake address in a region, or country, with lower taxes.

Morocco’s Minister of Economy and Finance, Nadia Fettah Alaoui, reportedly revealed the findings in response to a written question from a parliamentary advisor on Monday, February 6.

She indicated that tax authorities will enforce a set of measures to tighten control over companies that avoid paying taxes, as well as ration their obtaining of tax certificates, which allow them to participate in public deals.

Fettah noted that Morocco reinforced these measures under a regulatory memorandum issued on July 28, 2017, aiming to ensure equality among all Moroccan companies in regard to the documents necessary to participate in public deals.

In addition, the regulatory memorandum seeks to facilitate and standardize the procedures for granting companies based in the Moroccan southern regions tax certificates, which is done after those concerned submit a formal request.

The Moroccan tax authority has since 2018 been settling amicably the cases of companies with an address in southern Morocco but carrying out activities outside of the region, Fettah explained, noting that the companies have been paying their tax liability.