Understanding the Municipal Services Tax
The municipal services tax (TSC) is an annual local tax levied by Moroccan municipalities on built properties and land on which constructions have been erected. It is calculated on the annual rental value of the property, to which a rate of 10.5% is applied for buildings located within urban municipality boundaries and 6.5% for those in suburban and rural zones. The reference rental value is revised every five years by the tax authorities based on the local rental market conditions prevailing at the time of the revision.
The TSC is owed by the property owner or, failing that, by the usufructuary or occupant, even if occupying free of charge. It is added to the housing tax, which has been gradually eliminated since 2020 for primary residences, and to the land tax applicable to undeveloped plots. Property owners are required to file an initial declaration within three months of completing or acquiring the property, and then to report any change affecting the rental value within thirty days of its occurrence.
Cases of Full or Partial Exemption
The Moroccan General Tax Code provides for several cases of permanent or temporary TSC exemption. New constructions benefit from a full exemption for five years from the date of completion of the works. Social housing with a covered area of between 50 and 80 square meters and a total property value not exceeding 250,000 dirhams excluding VAT is permanently exempt. This exemption aims to encourage access to housing for low-income households who might otherwise be unable to afford homeownership.
Buildings belonging to the State, local authorities, and public establishments are exempt when assigned to a use of general interest. Premises used for non-profit educational, healthcare, sports, or social activities also benefit from an exemption. Furthermore, individuals whose total annual income does not exceed 30,000 dirhams and whose primary residence constitutes their only real estate property may benefit from an exemption upon an express application submitted to the competent tax authority.
Steps to Claim Your Exemption
To benefit from a TSC exemption, the taxpayer must submit a reasoned request to the regional tax directorate with jurisdiction over their property. This request must be accompanied by all supporting documents attesting to compliance with the required conditions: construction completion certificate for new builds, title deed, annual income statement, and any document proving that the premises are used for an exempt purpose. The administration has three months to process the file and notify its decision.
If the exemption request is rejected, the taxpayer may contest the decision through a preliminary complaint to the regional tax director, then by appeal before the local taxation commission or before the competent administrative courts. Nesty advises property owners in Agadir and the surrounding region in optimizing their real estate taxation, particularly by identifying the exemptions they may be entitled to and supporting them in assembling the necessary documentation to effectively benefit from them.
