Turkish government’s new incentive package

The Law Proposal on the Amendment of the Unemployment Insurance Law and Some Laws signed by the AK Party deputies was submitted to the Presidency of the Turkish Grand National Assembly. (Tera Yatırım)

The Law Proposal on the Amendment of the Unemployment Insurance Law and Some Laws signed by the AK Party deputies was submitted to the Presidency of the Turkish Grand National Assembly. The package includes articles on issues such as cash repatriation, supporting flexible working, corporate tax reductions, other tax regulations, incentives for public offerings, and deepening capital markets. If we look at the important items;

 

·        Persons bringing assets from abroad, including cash, gold, foreign exchange and capital market instruments, will not pay any taxes. With this arrangement, a new cash repatriation law is brought to the agenda.

·        Extending tax and social security premium support to private sector employers who create additional employment is on the agenda. Thus, it is aimed to maintain the level of employment on the one hand and support company activities on the other. With the President's decision, the duration of employer premium support, premium incentive, income tax withholding incentive and stamp tax support will be extended until December 31, 2023, and the duration of short-time working allowance until June 30, 2021.

·        The corporate tax reduction for exporting companies is included in the package, provided that they meet certain criteria in terms of income and employment.

·        Incentives for employers for hiring young workers as part of flexible work programs. It can be considered as an item to encourage flexible working and increase youth employment.

·        President Mr. Erdoğan will have the power to lower the corporate tax rate. Corporate tax reduction is on the agenda for companies that sell shares in public offerings or have a free float rate of over 20%. The corporate tax rate, which is currently 22%, would decrease to 20% at the end of this year, and this rate will be possible to decrease further with the President's decision.

·        Regarding the taxation of capital market instruments, the implementation period of the temporary article 67 is extended until the end of 2025. While the main article is subject to taxation of capital market instruments by declaration method, the taxation is done by withholding tax in the temporary article 67. There was a higher rate of taxation in the declaration procedure.

 

Kaynak Tera Yatırım
Hibya Haber Ajansı

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