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Rabat- Morocco is expanding tax incentives for the agricultural sector in a move aimed at encouraging investment, accelerating modernization, and protecting small and medium-sized farms as climate pressures and rising production costs continue to challenge the industry.
The new measures, outlined under an updated fiscal framework for agriculture, target farmers, agricultural cooperatives, agribusiness companies, and investors operating across Morocco’s agricultural value chain.
The government seeks to reduce the tax burden on agricultural activities and redirect financial resources toward investment in irrigation systems, mechanization, storage infrastructure, and value-added production.
Income tax and corporate tax
Under the new framework, agricultural producers generating annual revenues below MAD 5 million ($500,000) continue to benefit from a permanent exemption from Income Tax (IR) and Corporate Tax (IS) on agricultural income.
The measure is primarily intended to support small and family-owned farms, which account for a significant share of Morocco’s agricultural landscape.
For larger agricultural companies exceeding this threshold, taxation shifts to the ordinary regime. Agricultural companies subject to Corporate Tax benefit from the unified 20% corporate tax rate, while firms generating net profits exceeding MAD 100 million ($10 million) are taxed at a rate of 35%.
On the Income Tax side, individual farmers whose revenues exceed the exemption threshold become subject to the standard progressive income tax scale applicable to professional income.
The Value Added Tax (TVA) regime also remains highly favorable to agriculture. Sales of agricultural products in their natural state, or following simple non-industrial processing, remain outside the scope of VAT.
everal agricultural inputs also continue to benefit from VAT exemptions, including farming equipment, fertilizers, seeds, seedlings, and phytosanitary products.
Annual special tax on motor vehicles
Another notable measure concerns the Annual Special Tax on Motor Vehicles (TSAV). Agricultural vehicles, including tractors and other machinery used exclusively for farming activities, remain exempt from the tax, helping reduce operating costs for producers and encourage further mechanization.
Additional incentives also apply to registration fees and land transactions linked to agricultural activities, particularly within the framework of agricultural land restructuring and investment projects.
The measures come at a time when Morocco is seeking to build a more resilient agricultural model capable of adapting to recurring droughts, improving productivity, and attracting private investment into higher-value agricultural activities.
Beyond tax relief, the strategy reflects a broader policy objective of transforming agriculture from a sector focused primarily on production into one increasingly driven by investment, technology, and value creation.
