Housing Tax (TH) and Municipal Services Tax (TSC) in Morocco

Housing Tax (TH) and Municipal Services Tax (TSC) in Morocco: The Complete 2025 Guide

Local taxation is not just paperwork: it directly affects how safely you own, rent out, sell, or pass on your property.

Since June 2025, a major reform has changed the landscape: the Moroccan Tax Administration (DGI) now manages Housing Tax (TH) and Municipal Services Tax (TSC) instead of the local authorities and the Treasury (TGR).
Good news: the way taxes are calculated and the main exemptions remain the same.

This guide “translates” tax jargon into practical advice so you can understand the calculation, pay less legally, and avoid penalties or blocked sales.

1. 2025 Reform: Why Does the DGI Now Manage TH and TSC?

What changes for you

Before 2025, you often had to deal with:

• The commune (local authority),
• The Treasury (TGR),
• And sometimes the DGI.

With the 2025 reform (law n°14‑25 amending law 47‑06 on local taxation):

• You now have one main contact: the DGI for TH and TSC (assessment, tax bills, recovery, claims).
• Procedures are being centralised and digitised: online accounts, electronic tax bills, online payment.
• The TGR still appears for certain payment channels and for the tax clearance certificate needed at the notary, but in coordination with the DGI.

In practice: for any question on Housing Tax or TSC, your reflex should now be “ask the DGI / check the DGI portal”.

Purpose of law n°14‑25

• Modernisation and digitalisation of local tax collection.
• Better recovery of local taxes to finance communes and regions.
• Unified management of real estate–related taxes: professional tax, housing tax, TSC, rental income, capital gains, etc.

2. Who Is Liable for TH and TSC in Morocco?

Taxable properties

You are within the scope of TH and TSC if you own:

• Constructed buildings (houses, apartments, villas, mixed‑use property),
• Any type of construction (extensions, annexes),
• Dependencies: gardens, pools, garages or parking spaces attached to the main building.

Who is the taxpayer?

The tax is established in the name of:

1. The owner or usufruct holder first,
2. Failing that, the possessor or occupant.

Legally, the owner remains the main person liable, even if the property is rented out.

Professional equipment

The TSC also applies, for professional premises, to:

• Equipment, tools and production means that are already subject to professional tax.

For a workshop, shop or industrial unit, the TSC is therefore calculated on the rental value of the premises + taxable equipment.

3. TSC: Geographical Scope

The Municipal Services Tax finances roads, lighting, street cleaning and other local services.

It applies to taxable properties located:

• Within urban perimeters of urban communes,
• In peripheral zones defined by planning rules,
• In delimited centres of rural communes,
• In summer, winter and thermal resorts,
• And, since recent reforms, in certain areas covered by an urban development plan, even if they look like “outskirts”.

Practical reflex: if your property is in a built‑up or planned urban area, assume that TSC applies, unless a specific exemption exists.

4. How Are These Taxes Calculated?

The key concept: Rental Value (Valeur Locative – VL)

The rental value is the annual theoretical rent your property could generate.

It is determined by the administration based on:

• Local market rents for similar properties,
• The characteristics of your property (location, surface, condition, use),
• Periodic automatic revaluations.

All calculations (TH and TSC) start from this rental value, then apply abatements and tax rates.

TSC rates

On the rental value (after abatements), the TSC rate is:

• 10.50% in urban areas, delimited centres and tourist resorts,
• 6.50% in peripheral areas or zones covered by a planning document but outside core urban perimeters.

Who receives the money?

The TSC revenue is shared as follows:

• 95% for the commune,
• 5% for the region.

5. Exemptions and Abatements: Paying Less Legally

Main residence & MREs: 75% abatement

For both Housing Tax and TSC:

You benefit from a 75% abatement on the rental value if:

• The property is your main residence (you, your spouse, or direct ascendants/descendants), or
• It is the main residence in Morocco of a Moroccan residing abroad (MRE), occupied by you or close family.

This abatement drastically reduces the taxable base.

5‑year exemption for new constructions (TH only)

For new constructions used as a main residence:

• You get a 5‑year full exemption from Housing Tax, starting from the year after completion,
• On condition that you file the completion declaration within the legal deadline.

Important: this does not exempt you from TSC, which remains due (but with the 75% abatement if it is your main residence).

Non‑recoverable small amounts (200 MAD threshold)

If the total of local taxes due (TH + TSC) for a year is less than 200 MAD, the administration usually does not pursue recovery. In practice, no effective payment is required below this threshold.

Permanent full exemptions

Typically exempt from TH and TSC:

• State‑owned buildings,
• Premises of political parties and trade unions,
• Certain foundations and cooperatives, subject to strict conditions (activity, turnover, public interest).

6. Owner vs Tenant: Who Pays What?

Legal rule

The legal taxpayer is the owner or usufruct holder, even if:

• The property is leased,
• The tenant actually reimburses the tax under the lease.

The DGI will always turn to the owner first.

In practice: what the lease should say

Many commercial and residential leases include a clause stating that:

• The TSC, and sometimes the TH, are “recoverable charges” to be reimbursed by the tenant.

Advice:

• Always include a clear clause on TH/TSC in the lease,
• Specify who pays, and how the owner proves payment (tax notice, proof of payment).

In case of dispute, the court will look at the lease, but tax administration will still chase the owner if taxes remain unpaid.

7. Practical Guide: Payment, Deadlines and Penalties

Tax calendar

• Tax notices (avis d’imposition) are generally issued around March/April.
• The deadline for payment is 31 May each year for TH and TSC.

Where and how to pay (2025+)

You can usually pay:

• Online via the DGI portal (and, during transition, via TGR online services), (tgr.gov.ma)
• At partner banks (branches, ATMs, e‑banking, mobile banking),
• At tax offices / Treasury offices, depending on what is indicated on your tax notice.

Late payment penalties

After 31 May:

• 10% flat penalty,
• 5% surcharge for the first month of delay,
• Then 0.5% per additional month or fraction thereof.

In case of proven bad faith (fraud, concealment), higher penalties and forced recovery measures can apply.

8. Your Reporting Obligations: Don’t Get Caught Out

You must file a declaration (often called “completion / change declaration”) in particular when:

• A new construction is completed,
• You make extensions or major renovations,
• There is a change in ownership (sale, gift, inheritance distribution),
• There is a change in use (from residential to professional, or the opposite).

This must be done within the legal deadline (commonly by 31 January of the year following the event).

If you fail to declare:

• You risk losing the 5‑year exemption on Housing Tax,
• Your rental value may be set too high or corrected retroactively.

Tax clearance (Quitus fiscal): the “lock” on your sale

Before signing a deed of sale with a notary or adoul, you must provide a tax clearance certificate proving that:

• All taxes affecting the property (including TH and TSC) are fully paid.

If there are arrears or an ongoing dispute:

• The notary will block the transaction until the situation is settled.

Practically: start checking your TH and TSC situation several weeks or months before you plan to sell.

Main Residence vs Secondary Residence (TH/TSC)

FAQ 2025

1. Am I exempt from Housing Tax if I do not live in the property (vacant dwelling)?
No. Vacancy alone does not grant an exemption. Only main residence status (you or close family living there) or specific legal exemptions can reduce or remove TH.

2. How can I challenge a rental value that is too high?
You can file a reasoned claim with the DGI (online or in writing) within the legal deadline, attaching evidence: market rents for similar properties, photos, technical reports, etc. The administration may review the rental value.

3. Is TSC due on bare land?
TSC mainly targets built property and certain professional equipment. Urban bare land is usually taxed under a different tax: the Tax on Urban Undeveloped Land (TNB), with its own rules and rates.

4. Can I pay my Housing Tax by bank transfer / online?
Yes. Payment is generally possible through online platforms (DGI/TGR), partner banks, and physical counters indicated on your tax notice.