Recent currency fluctuations in Turkish Lira required authorities to take some urgent actions to moderate its effect on the local market. One of these regulations was the Cabinet Decree dated May 14, 2018 no. 2018/11818 that allowed Excise Duty (Special Consumption Tax [SCT]) amount of certain fuel products to be rearranged in line with the f/x changes to stabilize the price of fuels in the market.
In principle, the decree allowed Ministry of Finance to rearrange Excise Duty on Gasoil, Diesel and LPG products and their variances when the Turkish Lira currency is devalued over other currencies. With the power of this decree, several decisions were taken by the ministry and published on its website that reduced (and increased afterwards when recovery realised) these amounts.
Until the year end;
1- reduced title fee (3% instead of 4%)
2- reduced VAT rate on house sales (8% instead of 18%)
3- VAT rate of furnitures is reduced to 8%
4- VAT rate of commercial vehicles is reduced to 1%
5- Special Consumption Tax (SCT – Excise) of passenger cars is reduced.
6- Special Consumption Tax (SCT – Excise) of home appliances (white goods) is reduced to 0%
Free Trade Zones (FTZs) in Turkey are special areas that are determined by the Council of Ministers where all types of industrial, commercial and certain service activities are encouraged by tax exemptions and incentives.
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