Page 12 - VGOcak_2018

Vergide Gündem
English Translation

Latest amendments to the Turkish tax

legislation through the Law no. 7061

The draft law presented to the Turkish Parliamentary Speaker’s Office in late
September was never off the agenda since then. Finally, it has been published in the
Official Gazette dated 5 December 2017 following the approval at the Turkish Grand
National Assembly and the President’s endorsement.

Although many of its articles have been enacted as of publication date, some of its
articles will be taking effect from 2018, even early 2019.

In this article, we will be dealing with the taxational regulations in this law consisting
of 126 articles in total with two of them temporary articles.

• The rate taken into account for lump sum expense applicable to the taxpayers
declaring rental income (real property income) has been reduced to 15 % from
25 %. This provision will be effective for the declaration of income acquired as of
1 January 2017.

• For the wage earners seeing their net income lowered under TL 1.404,06 for
the months September, October, November and December of 2017 caused by
the income tax tariff, opportunity of compensating the amount remaining under
TL 1.404,06 through additional minimum living allowance is introduced. This
regulation will be effective from 1 September 2017.

• Corporate taxpayers will be subject to a corporation tax rate of 22 % over their
income acquired through the taxation periods for the years 2018, 2019 and
2020. This provision has been enacted as of the publication date.

• The current 75 % exemption rate applied over the income derived by corporate
taxpayers from the sale of immovable property (real estate) held within assets for
at least two years is reduced to 50 %. This provision has been enacted as of the
publication date of the Law.

• The duty fee that should be paid during application and renewal related to the
advance pricing agreements has been eliminated effective from the Law’s date of
publication.

• Increase rate for motor vehicles taxes (MTV) regarding 2018 on passenger cars
registered prior to 31.12.2017 will be 15 % for passenger cars with engine
3
capacity at 1300 cm and lower while the rate of increase is set as 25 % for
others.
• A new taxation system for the passenger cars to be registered from 01.01.2018
will be adapted. Motor vehicle taxes of the mentioned passenger cars will not
only be differentiated according to the engine cylinder capacity and age, but also
depending on the market value of those vehicles. Also, the Law provides context
on the MTV amounts to be applicable on these passenger cars for 2018. The
concerning tables show the changes on increase rates between 15 % and 50 %.

12 Ocak 2018