TRADE OPENNESS AND TAX STRUCTURE IN MOROCCO: EVALUATION AND IMPACTS

In the present work, we seek to empirically assess the effects of trade openness on the Moroccan tax structure. The estimations are covering the period between 1985 and 2019. The results of the modeling using the Two-Stage Least Squares (2SLS) method confirm that the reduction of customs duties has a negative impact on foreign trade revenues, and consequently, on total tax revenues. Also, the reduction in customs duties reduces domestic revenues, notably, value-added tax, and corporate tax. Additionally, it has been shown that not only do the other channels of transmission of trade openness, namely: the liberalization of imports, the promotion of exports, and the variability of the exchange rate, lead to a decrease in trade revenue, but they also bring about an increase in domestic revenue. Finally, the results of the stylized facts and economic modeling allowed us to deduce that the measures taken by Moroccan economic decision-makers to stimulate foreign trade have led to a loss of trade taxes and fiscal injustice.