Turkish Economic Program prioritizes price stability and balanced growth, Simsek says

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Treasury and Finance Minister Mehmet Simsek announces new package to encourage foreign currency inflows into Turkiye

Turkish Economic Program prioritizes price stability and balanced growth, Simsek says

The rate of tax reductions and exemptions to be applied to some activities of income and corporate taxpayers abroad will be increased to encourage them to bring foreign currency into Turkiye, Treasury and Finance Minister Mehmet Simsek said in an interview with Anadolu Agency on Wednesday.

Simsek stressed that the economic programme aims to achieve more balanced, inclusive, and sustainable growth and a permanent increase in welfare. The Turkish minister said that the priorities of the programme include establishing price stability permanently, supporting investments, employment, production, exports, and the competitive environment, improving the current account balance, and financing the budget with sustainable and healthy resources.

He pointed out that within this framework, they will implement structural reforms to increase production, competitiveness, and productivity that will carry out monetary, fiscal, and revenue policies in coordination, and explained that they continue to work towards the policies stated in the Medium Term Programme in the field of taxation.

TAX DEDUCTION TO BE INCREASED

The Turkish minister said that they have prioritized some of these studies and that the issue will soon come to the agenda of the Turkish parliament.

"With the package, we envisage arrangements to support exports and encourage foreign currency inflow to our country to contribute to the realization of the economic programme targets. To encourage the inflow of foreign currency to our country, we will increase the tax discount and exemption rate to be applied to some activities of our income and corporate taxpayers abroad, provided that the earnings are brought to the country," Simsek said.

He said that to support exports, they will apply a corporate tax reduction of approximately five points regarding the activities of manufacturers and supplier exporters.

"The application will apply to export activities carried out by manufacturers or supplier organizations through foreign trade capital companies or sectoral foreign trade companies based on an intermediated export contract," he added.

The Turkish minister also gave information about the details of the application that will encourage the bringing of foreign currency to Turkiye.

"We are increasing the 50 percent income exemption provided for income from architecture, engineering, software, design, data processing, call services, education, and health activities provided as services abroad to 80 percent, provided that the income is brought to Turkiye. Thus, we are reducing the tax burden of our corporate taxpayers to 5 percent for these earnings," he stated.

Finally, Simsek stated that 50 percent of the dividends earned by income and corporate taxpayers from abroad will be exempt from income and corporate tax, provided that they are brought to Turkiye.

Source: Anadolu Agency

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