On 24 October 2019, the Turkish Government submitted a new draft law to the Parliament, which proposes regulations on the tax system. The draft law introduces new taxes, namely digital services tax (DST), valuable house tax and accommodation tax. The key measures of the draft law are as follows:
Corporate Income Tax
Government proposes to reduce corporate tax from 22% to 20% in 2020, with a consecutive reduction to 18% in 2021 for nonfinancial institutions.
Digital Services Tax (DST)
Government proposes new digital services tax with a rate of 7.5%.
Valuable House Tax
Valuable house tax will be applied on houses worth between TL5 million to TL7.5 million with a rate of 0.3%, between TL7.5 to TL10 million with a rate of 0.6%, and houses worth over TL10 million will be taxed with a rate of 1%.
Accommodation Tax
The hotel accommodation tax rate will be 1 percent for 2020 and 2 percent for 2021. The new tax will come into force in April next year.
Therefore, Government also proposes for changes in individual income tax and sales tax on foreign exchange. The draft law would be passed by the Parliament before the end of this year.
