MOST RECENT DEVELOPMENTS IN TAX DUTIES, LEVIES AND CHARGES
The most recent legal regulation on Fixed Duties, Value Added Taxes (VAT), Taxes on Consumer Loans and Game of Chance has been published in Turkish Official Gazette are as follows:
FIXED DUTIES
“President decision on adjustment of fixed duties in Tariff under Duties Law numbered 492” (“Decision”) has been published in Official Gazette dated 07.07.2023, numbered 32241 and entered into force on 08.07.2023. The duties and charges on “Jurisdiction, Notary, Title Deed, Consulate, Passport, Residence Permit, Work Permit, Exclusion of Work Permit, Visa, Approval of Ministry of Foreign Affairs, Ship and Harbor, License, Degree and Traffic” has increased 50% by the mentioned Decision. Besides, the duties on “permission for mobile phones carried from abroad with the passenger” has increased from TRL 6.091,00 to TRL 20.000,00 However, Duties on Driving License has been excluded from such increase.
TAX VALUE ON CONSUMER LOANS
“President decision dated 6/7/2023, numbered 7345” (“Decision”) has been published in Official Gazette dated 07.07.2023, numbered 32241 and entered into force on publication date. The banking and insurance transaction taxes to be accrued on consumer loans has increased to 15% by the mentioned Decision. The new percentage shall be applicable for the new loans to be used as of enforcement date of Decision.
VALUE ADDED TAXES (VAT)
“President Decision on Amending the Decision on the Determination of Value Added Tax Percentage to be Applied to Goods and Services” (“Decision”) has been published in Official Gazette dated 07.07.2023, numbered 32241 and entered into force on 10.07.2023. VAT percentage of 18% which applied to goods and services within the scope of item (a) specified in the first paragraph of article 1 of the Decision has increased to 20%, VAT percentage of 8% which applied to goods and services within the scope of item (b) has increased to 10% by the mentioned Decision. The VAT percentage to be applied on “soap, shampoo, detergent, disinfectants, wet wipe, toilet paper, paper towel, tissue and napkin” has also increased from 8% to 20%. In this regard, the applicable VAT percentage on products such as “gasoline, automobile, furniture, white goods, electronic products, tobacco products and alcohol” shall be 20%; VAT percentage on "products such as textiles, clothing, bag, luggage, and cultural and social services such as theatre, cinema, museum and hotel” shall be 10%. However, the VAT percentage determined as 1% for staple food products such as "rice, bulgur, chickpea; water, tea, sugar, oil, meat and milk" shall remain same.
TAX VALUE ON SPOR GAME BASIS JOINT BETTING
“President decision dated 6/7/2023, numbered 7347” (“Decision”) has been published in Official Gazette dated 07.07.2023, numbered 32241 and entered into force on publication date. The tax percentage applied as 5% for mutual betting based on sports competitions has increased to 10%, the tax percentage applied as 7% for horse races has increased to 14% and the tax percentage applied as 10% for other games of chance has increased to 20% by the mentioned Decision.
Finally, addition to above mention increases in tax duties and charges which entered into force with a short notice, a new regulation on Corporate Tax is expected to enter into force within July, 2023. In such a case the tax percentages stipulated in the first paragraph of Article 32 of the Corporate Tax Law numbered 5520 shall be increased 5 points. Hence, Corporate Tax Percentage shall be 25% for legal entities, 30% for banks, leasing, factoring, e-payment companies, insurance and reinsurance company, Stock Exchange Associations, retirement companies.