Yeni Vergi

Yeni Vergi: A Comprehensive Guide for Turkish Taxpayers

Introduction

Yeni Vergi, implemented in Turkey on January 1, 2023, represents a significant reform in the country's tax system. This comprehensive guide provides valuable information and insights to assist taxpayers in understanding the nuances of Yeni Vergi and its implications for their financial obligations.

Understanding Yeni Vergi

Yeni Vergi aims to enhance Turkey's tax system, making it more equitable and responsive to the changing economic landscape. The reform introduced notable changes to various tax categories, including the following:

• Corporate Income Tax
• Personal Income Tax
• Value-Added Tax (VAT)
• Special Consumption Tax
• Stamp Duty Tax

Key Changes in Corporate Income Tax

The corporate income tax rate has been lowered from 20% to 19%. This reduction is expected to stimulate economic growth and attract foreign investment.

Yeni Vergi also introduces a new tax incentive for research and development (R&D) expenses. Companies can now deduct up to 100% of R&D expenses in the year incurred.

Personal Income Tax Updates

Personal income tax rates have been adjusted under Yeni Vergi, with the number of income tax brackets increasing from five to seven. This change aims to provide tax relief for low- and middle-income earners.

The tax-free threshold for personal income has also been increased. Individuals earning below a certain threshold will be exempt from paying income tax.

Changes in Value-Added Tax (VAT)

The standard VAT rate remains at 18%, but Yeni Vergi introduces a reduced VAT rate of 8% for certain essential goods and services, such as food and beverages.

Additionally, the reverse charge mechanism for VAT has been expanded to include more transactions. This mechanism shifts the responsibility for VAT payment from the supplier to the recipient.

Other Tax Implications of Yeni Vergi

• Special Consumption Tax rates have been revised for various products, including tobacco, alcohol, and fuel.
• Stamp Duty Tax has been eliminated for certain transactions, such as real estate transfers.
• A new tax on digital services has been introduced, applying to companies that provide electronic services in Turkey.

Compliance with Yeni Vergi

Taxpayers are responsible for ensuring compliance with the provisions of Yeni Vergi. This includes:

• Filing accurate tax returns
• Making timely tax payments
• Keeping proper accounting records

Failure to comply with Yeni Vergi may result in penalties and other legal consequences.

Conclusion

Yeni Vergi is a comprehensive reform that significantly impacts the Turkish tax system. Taxpayers are advised to seek professional advice to ensure a thorough understanding of the changes and to comply with their tax obligations. By embracing the provisions of Yeni Vergi, taxpayers can contribute to the development of a more equitable and efficient tax system in Turkey.