Key takeaway: The minimum contribution (cotisation minimale — CM) is a floor tax that every company subject to corporate tax (IS) must pay even when its taxable income is nil or negative. The standard rate is 0.25% since the 2023 Finance Law (Art. 144 CGI), reduced to 0.15% for essential consumer goods, with an absolute floor of MAD 3,000. Newly created companies are exempt for their first 36 months of activity.
What is the minimum contribution?
The minimum contribution is a fiscal mechanism established by Article 144 of the General Tax Code (CGI) that guarantees the State a baseline level of corporate tax revenue, regardless of the company’s financial performance. It acts as a tax floor: if the computed IS falls below the CM, the latter is payable instead.
This mechanism reflects the principle that any company conducting business in Morocco must contribute to public finances, even during periods of tax losses.
Minimum contribution rates in 2026
Since the reform introduced by the 2023 Finance Law, the CM rates have been revised:
| Category | CM Rate | Reference |
|---|---|---|
| Standard | 0.25% | Art. 144-I-A, LF n° 50-22 art. 6 |
| Essential consumer goods (regulatory list) | 0.15% | Art. 144-I-B, LF n° 50-22 art. 6 |
Products eligible for the 0.15% reduced rate: petroleum products, gas, butter, oil, sugar, flour, water, electricity, medicines.
Historical CM rate changes
| Period | Standard rate |
|---|---|
| Before 2019 | 0.50% |
| 2022 | 0.40% |
| Since 2023 | 0.25% |
Absolute floor
Regardless of the calculation result, the minimum contribution cannot be less than MAD 3,000 (Art. 144-I, last paragraph). This absolute floor applies to all subject companies.
Calculation base
The CM base is broader than taxable income. It encompasses all revenue and products received by the company:
CM Base = Turnover (excl. VAT) + Ancillary income + Financial income + Subsidies and grants received
Specifically, the base includes:
- Turnover excluding VAT generated during the fiscal year
- Ancillary income: rental income, commissions, royalties, routine disposals
- Financial income: credit interest, foreign exchange gains, investment income
- Operating and balancing subsidies received
Excluded from the base:
- Capital gains on disposal of fixed assets (except routine disposals)
- Reversals of provisions and expense transfers
- Exceptional non-recurring income
This broad base explains why companies with significant turnover but low taxable income often owe the CM rather than the IS.
36-month exemption for new companies
Article 144-I-D of the CGI provides an exemption from the minimum contribution for the first 36 months following the start of the company’s business activity. This measure supports businesses in their start-up phase.
Key points:
- The exemption runs from the date of effective commencement of operations, not from the date of legal incorporation
- It applies automatically, without any special formality
- During this period, if the computed IS is positive, it remains payable
- The exemption covers only the CM as a floor; it does not waive IS actually owed
Professional tax advisory helps optimise this exemption period, particularly for companies launching with heavy initial investments.
CM vs. IS: the comparison mechanism
At year-end, the company performs a dual calculation:
- IS calculation: taxable income × applicable IS rate
- CM calculation: CM base × applicable CM rate
The higher amount is the tax effectively owed:
- If IS > CM → the company pays IS
- If IS < CM → the company pays CM
Carrying forward excess CM
When the CM exceeds the IS, the excess may be offset against IS due over the following 3 fiscal years (Art. 144-III). If the excess has not been fully offset by the end of that period, it is permanently forfeited.
Example: A company pays MAD 50,000 CM while the computed IS is MAD 35,000. The MAD 15,000 excess may be offset against IS for years N+1, N+2, and N+3.
CM and provisional installments
The CM also plays a role in calculating provisional installments. Each quarterly installment equals 25% of the IS or 25% of the CM from the previous year, whichever is higher.
For the first fiscal year, the CM used as the reference for installments is calculated on elements from that year. Companies exempt from CM (first 36 months) pay installments based on the theoretical CM.
| Situation | Installment base |
|---|---|
| Prior IS > Prior CM | 25% × prior IS |
| Prior IS < Prior CM | 25% × prior CM |
| First fiscal year | 25% × estimated CM |
Worked example
Consider an LLC (SARL) with the following data for fiscal year 2026:
| Item | Amount (MAD) |
|---|---|
| Turnover (excl. VAT) | 4,000,000 |
| Ancillary income | 120,000 |
| Financial income | 80,000 |
| Subsidies received | 0 |
| Taxable income | 150,000 |
IS calculation: 150,000 × 20% = MAD 30,000
CM calculation: (4,000,000 + 120,000 + 80,000) × 0.25% = MAD 10,500
Since IS (30,000) > CM (10,500), the company pays MAD 30,000 in IS.
If taxable income had been MAD 20,000: IS = 4,000 < CM = 10,500 → the company would pay MAD 10,500 CM, with a MAD 6,500 excess offsettable over the next 3 years.
Legal references: General Tax Code 2026 — Art. 144 (PDF) — Circular Note No. 717 — IS (Volume 1)
Frequently asked questions
Is the minimum contribution due when the company is in a loss position?
Yes. The CM is due even when taxable income is nil or negative, except during the first 36 months of activity. This is precisely its purpose: ensuring minimum tax revenue regardless of the result. However, excess CM over IS may be offset against IS for the following 3 fiscal years.
What exactly is included in the CM calculation base?
The base includes turnover excluding VAT, ancillary income, financial income, and subsidies received. Capital gains on fixed asset disposals and provision reversals are excluded. The standard rate is 0.25% since the 2023 Finance Law (0.15% for essential consumer goods), with an absolute floor of MAD 3,000.
How does the CM interact with provisional installments?
Provisional installments are calculated on the higher of IS and CM from the prior year. Each installment represents 25% of this reference amount. Thus, even a company whose IS is lower than its CM pays installments based on the CM.
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