Projected Financial Gains from Betting and Lottery Activities in Morocco
The Moroccan government has revealed ambitious financial forecasts as part of the 2027 Finance Law, specifically bill number 60.26. The government anticipates generating approximately 195 million dirhams (19.5 billion centimes) from betting and lottery activities, as well as profits from the Royal Society for the Encouragement of Horses (SOREC) for the upcoming fiscal year. This projection coincides with an initiative aimed at tightening tax regulations on winnings derived from gambling, incorporating tax declarations related to these activities into scenarios that enable the tax administration to directly implement automatic tax assessments under existing legal frameworks.
According to data included in the tables appended to the proposed law, which balances the preservation of resources from betting activities with the enhancement of mechanisms for declaring taxable winnings, a budget of 170 million dirhams has been earmarked for two special treasury accounts. The first account pertains to deductions from mutual betting, while the second is related to lottery proceeds. Additionally, the government expects to collect an extra 25 million dirhams in profits that will be distributed by SOREC to the state, given its pivotal role in organizing horse racing-related betting activities in the kingdom. This cumulative calculation brings the total projected resources across the three categories to 195 million dirhams.
Strengthening Tax Oversight and Compliance
The financial details of the project indicate that the government is forecasting revenue of 90 million dirhams from the account dedicated to deductions from mutual betting, as specified in table 'A' concerning state resources. Table 'Z' has similarly set the expenditure ceiling for this account at the same amount, showcasing that these resources are allocated to fund expenses associated with the designated purposes of this account, rather than being included in the general funds available for various budgetary expenditures.
Moreover, the same data suggests that the lottery account is projected to receive expected financial resources amounting to 80 million dirhams during the upcoming fiscal year, with authorized expenditures also capped at the same figure, leading to an aggregate resource allocation of 170 million dirhams within the framework of special treasury accounts. Overall, the total anticipated resources for these accounts are expected to reach approximately 182.5 billion dirhams, with over 170.4 billion dirhams allocated to accounts reserved for specific purposes.
The government’s forecasts extend beyond the allocations directed to special accounts; the new finance law also includes additional revenue of 25 million dirhams expected from the profits to be distributed by SOREC. This is classified under resources overseen by the Directorate of Public Enterprises and Privatization, specifically within the section concerning profits from other companies. Thus, the total estimated resources linked to betting and lottery activities now amounts to 195 million dirhams, divided between allocations for special accounts and anticipated profits from institutions operating in the sector.
These projections highlight the multiple channels through which public finances benefit from activities associated with gambling and lottery games, including allocations directed toward specific accounts and anticipated profits from entities operating within the sector. However, it is crucial to note that the projected amount does not represent the total turnover of betting and lottery activities in Morocco, nor does it encompass the total taxes and fees that may arise from various related operations, given the differing accounting and tax nature of the three resources included in the proposal.
In contrast, the proposed law retains two other provisions within the general budget resources managed by the Ministry of Economy, Finance, and Public Administration. The first concerns deductions from betting games, while the second pertains to deductions from horse and greyhound racing bets, without providing numerical expectations regarding the amounts to be collected from them during the next fiscal year, merely mentioning them as "for reference"; this wording allows the inclusion of these provisions within the resource classification without assigning estimated amounts in the financial accounts for the year in question.
This specification confirms the continued existence of these two provisions within the general budget resources, without calculating estimated revenues for them during the preparation of the proposal. This situation confines the 195 million dirhams figure solely to the numerically defined resources within the financial tables and does not allow it to be seen as a comprehensive and definitive total of all public revenues that may arise from gambling and lottery activities during 2027, especially considering the existence of other deductions for which no financial forecasts have been specified in the document.
In conjunction with the forecasted financial resources from lottery and betting activities, the new finance law incorporates provisions aimed at enhancing the tax administration's authority to monitor the earnings derived from gambling activities. This is accomplished through amendments to Article 228 of the General Tax Code, which pertains to the automatic tax assessment process, encompassing the declaration of gambling winnings as outlined in Article 154, repeated three times in the same code. This move aims to bolster compliance with the obligation to declare taxable revenues.
Under the proposed framework, failure to submit the tax declaration related to gambling winnings within the legal deadlines, or submitting it incompletely, will be among the cases that could trigger the automatic tax assessment process, in accordance with the conditions and procedures established by tax legislation. This allows the General Directorate of Taxes to determine the tax obligations due in instances of non-compliance with declaration duties while adhering to the legal guarantees and procedures governing such actions.
These provisions hold particular significance given the nature of the revenues generated from gambling activities, which differ from regular salaries and professional income. The proposed amendment seeks to enhance compliance with the declaration of taxable earnings and broaden the range of procedures available to administration in addressing cases of non-declaration or incomplete declaration, without constituting the establishment of a new tax on gambling based solely on this amendment. Instead, it expands the scope of application of an existing tax procedure based on breaches of declaration obligations.
The project sets January 1, 2027, as the effective date for the amendments related to Article 228, for processes commencing from this date. This means that the upcoming fiscal year will witness, pending final approval of the proposed provisions, an expansion of the automatic tax assessment process to include instances of non-declaration of gambling winnings or breaches of related obligations, according to established legal procedures, without immediate imposition of tax solely due to delays in declaration beyond procedural controls.
These amendments indicate a dual approach to managing the sector, focusing on benefiting from the financial resources generated by betting and lottery activities on one hand and enhancing tax oversight on individual earnings resulting from them on the other hand. This strategy allows for distinguishing between deductions imposed on the activities themselves and the tax obligations that may arise for beneficiaries of its profits, within the framework of expanding the tracking of taxable income and improving compliance with declaration duties.
Despite the projected resources from gambling and lottery activities, along with profits from SOREC reaching 195 million dirhams, their financial weight remains limited when compared to the overall expected public budget revenues of approximately 482.4 billion dirhams for the next year. The mentioned resources only account for about 0.04 percent of this total, considering that the majority falls under special treasury accounts rather than the ordinary revenues of the general budget.
These figures reflect the continued reliance of the state on diverse financial resources, albeit limited in scale, to support certain special accounts and generate profits from institutions linked to betting activities. As the tax policy shifts toward enhancing tracking of individual earnings derived from gambling activities and linking them to declaration and tax oversight obligations, it suggests that 2027 may witness a tightening in how instances of non-compliance with these earning declarations are handled.
It is important to note that the amount of 195 million dirhams remains an estimate of numerically defined resources in three financial sections linked to betting, lottery, and SOREC, rather than an indicator of the total revenues from the gambling market in Morocco or the aggregate tax revenues generated from it. This comes as the legislative process for the 2027 Finance Law, currently presented to Parliament for discussion and voting, remains ongoing, with potential amendments to some of its provisions and financial estimates before final approval.
As reported by hespress.com.
