Pensions: Who will benefit from the exemption?
Starting next year, basic retirement pensions (excluding supplementary pensions) will be exempt from income tax. This measure, which will be implemented in two stages (50% in 2025 and 50% in 2026), will cost the Government almost 1.2 billion dirhams (USD 120 million).
However, for a majority of pensioners, particularly those in the private sector, this provision is likely to have little or no impact. In fact, only 32 pensioners are subject to income tax. In the private sector, pension levels leave little room for real benefit. At the National Social Security Fund (Caisse Nationale de Sécurité Sociale, CNSS), where pensions are calculated on the basis of a ceiling of 6,000 dirhams (USD 600), the maximum pension does not exceed 4,200 dirhams (USD 420). With tax allowances already in place, this exemption remains symbolic for most beneficiaries. The situation is scarcely better in the Group Retirement Allowance Scheme (Régime collectif d’allocation de retraite, RCAR), where only 12% of retirees will actually benefit from this exemption. At the Moroccan Retirement Fund (Caisse marocaine des retraites, CMR), around 20% of pensioners could take advantage of this measure. Clearly, this exemption remains insufficient to counter the erosion of purchasing power, exacerbated by inflation over the past three years.
Overall, to benefit fully from this exemption, you need to receive a pension of 11,000 dirhams (USD 1,100) or more. But how many pensioners exceed this threshold? The figures show that very few are concerned, reinforcing the impression that this reform is more symbolic. This measure comes at a time when pension systems are structurally fragile and marked by profound inequalities. Disparities between schemes reinforce this observation. At the CNSS social security agency, the average monthly pension will not exceed 2,168 dirhams (USD 216) in 2023, a far cry from the 5,600 dirhams (USD 560) of the RCAR Allowance Scheme or a far cry from the 7,873 dirhams (USD 787) of civil pensions. These discrepancies reflect the heterogeneity of pension calculation and management rules. In addition, there are inconsistencies in the revaluation mechanisms. The civil pension scheme has not seen an increase since 1997, while in the private sector, such adjustments require decrees, the latest dating from 2006, except for an exceptional increase in September 2022. In contrast, the RCAR is characterized by automatic annual revaluation, offering greater protection against inflation.
The pension exemption, while welcomed by some, does not address the structural challenges facing pension schemes. Without harmonized rules and regular pension increases, this measure will remain insufficient. For a real transformation, the government will have to go beyond fiscal adjustments to lay the foundations for a fairer, more equitable and sustainable system.
Khadija MASMOUDI
