Money collectors turn to banks for fear of tax
This article was automatically translated from HIBAPRESS, the Arabic version:
This article was automatically translated from HIBAPRESS, the Arabic version:
Heba Press – Abdel Latif Baraka
As part of a major step aimed at strengthening financial transparency and combating tax evasion phenomena, the Ministry of Finance and Economy of Morocco, in cooperation with the Tax Directorate, has launched a new procedure tax which includes the deduction of 5% of income tax on funds deposited in banks. , as part of encouraging citizens to deposit… Their money is in the banking system instead of being stored in informal places. This measure aims to reduce the phenomenon of “cash” (money in circulation), which has increased remarkably in recent years, and its negative effects on the national economy.
The impact of the measure on Moroccan banks
Since the activation of this procedure, Moroccan banks have experienced an unprecedented movement in terms of opening accounts and depositing funds, while many individuals who hid their money in iron safes or in businesses began depositing huge sums that banks had not noticed in recent years. Some sources indicate that one of the banks in the city of Agadir received customers carrying huge sums of money, ranging from several hundred million dirhams, which constitutes a precedent in the history of the Moroccan banking sector.
This trend reflects a direct interaction with the tax campaign launched by the Tax Department, which aims to force bank account holders to reveal the origin of deposited funds. Although there is no official obligation on the part of individuals to disclose the origin of funds when depositing, the State offers the possibility of settling these funds voluntarily by paying only 5% of the value of the funds not authorized, while avoiding any legal liability regarding the source. of these funds if they are deposited before the end of 2024.
He went to banks to deposit money to avoid taxes
Many banks witnessed colossal deposits in the last days of December 2024, reflecting the fear of some individuals over the new tax measures that will come into force from January 2025. The government is expected to impose harsh taxes to the big banks. cash deposits in banks, which could reach 37%, which could raise new questions about funding sources.
For example, a sum of 400 million centimes was deposited in a bank in the city of Agadir, which requires a lot of effort to count this sum. This amount was stored in an iron safe at home, so its owner found himself motivated to disclose this money rather than bear the risks of legal action later.
Campaign and tax evasion
Alongside this measure, the Tax Department organized a massive campaign against cash hoarders, during which they were asked to clarify the sources of the money they hide from the banking system. The campaign consists in particular of encouraging these individuals to deposit their money in banks in exchange for paying 5% of its value as a tax contribution. The objective of this campaign is to combat tax evasion which harms the national economy, as the amount of money that remains outside the banking system is estimated at around 430 billion dirhams, which is equivalent to around 30 % of Morocco’s gross domestic product.
The expected impact on the economy
Expectations indicate that this measure will help increase financial transparency and strengthen the state’s capacity to combat unauthorized activities, such as money laundering and corruption. These measures are also expected to help accelerate the movement of funds within the national economy, which could lead to a resumption of economic activity in general. By incentivizing individuals to transfer their money to banks, it will be possible to broaden the tax base, which will help the government finance national development projects and achieve sustainable growth.
Concerns about liquidity impact of cash in markets
Despite the expected benefits, concerns remain about potential negative effects on the money market if a significant tax were imposed on cash deposits at banks. In this context, Abdellatif Jouahri, governor of the Bank of Morocco, expressed his concerns about the high volume of liquidity in circulation, which exceeded 430 billion dirhams, warning that this percentage is among the highest in the world, which could reflect a problem of financial transparency and negatively affect the stability of the national financial system.
The new tax measure implemented in Morocco constitutes an important step towards improving financial transparency and the fight against tax evasion. By encouraging citizens to deposit their money in banks and pay reasonable taxes, Morocco hopes to strengthen its national economy and strengthen its collection base, while these measures should be part of broader efforts aimed at combat informal economic activities, such as money laundering and taxes. escape. Despite the challenges that could result from these measures, it can be hoped that these policies will help improve Morocco’s economic and financial situation in the near future.
