Turkey To Overhaul Income Tax Structure In Bid To Boost Economy
23 October 2013
Posted by: Author: Ali Berat Meric
Author: Ali Berat Meric (Bloomberg)
A new income tax law being drafted
in Turkey’s parliament would expand the tax base by encouraging
investment and manufacturing and bringing more undeclared income
out into the open, Finance Minister Mehmet Simsek said in an
The bill strives to achieve those aims through measures
including narrower exemptions, incentives for farmers and new
taxes on income from real estate. It is also would tighten
oversight on tax collection in manufacturing.
"We took an important step by submitting this bill to the
parliament, it amounts to a reform,” Simsek said in an
interview at parliament. He didn’t have a specific timetable for
Simsek said the bill strives to improve transparency,
leaving "no room for gray areas” in tax regulation. Savings
will be encouraged and tax deductions will be offered on
education and health spending, he said.
The bill was submitted to parliament in June and must be
approved by two parliamentary panels before it is returned to
the full legislature for a vote.
"The most noteworthy regulation in the bill is that it
narrows exemptions on capital gains and profits from real estate
in cities,” Osman Arioglu, a former head of Turkey’s tax
authority, said in a telephone interview today. "That would
increase tax revenue.”
Arioglu predicted the government would defer a vote on the
bill until after local elections in March 2014.
"I don’t think the government will push for such a drastic
change in tax structure before local elections,” Arioglu said.
This article first appeared in bloomberg.com.