Turkey's newly gazetted Law No. 7577 prohibits tax deductions for betting and gambling advertisements while adjusting VAT exemptions for foundation university hospitals and expanding corporate tax breaks for free zone manufacturers, with changes taking effect between April 2026 and January 2027.
Turkey’s Revenue Administration has gazetted Law No. 7577 on 17 April 2026. Law No. 7577, which introduces widespread amendments to various tax, finance, and administrative statutes scheduled for 2026.
The legislation implements strict limitations on gambling advertisements by categorising them as non-deductible expenses while adjusting Value Added Tax exemptions for university operations and state land acquisitions.
Advertising and promotion expenses for betting and games of chance
The law introduces new restrictions on deductible expenses for both individual and corporate taxpayers. Article 41 of the Income Tax Law (No. 193) has been amended to include advertisement and publicity expenses for all types of chance and betting games as non-deductible expenses. A similar provision was added to Article 11 of the Corporate Tax Law (No. 5520), rendering these same advertisement and publicity expenses non-deductible for corporations. These provisions entered into force on 17 April 2026.
Exemptions for foundation university hospitals
Law No. 7577 modifies the tax status of healthcare facilities operated by higher education institutions established by foundations. The law amends the Higher Education Law and the VAT Law to withdraw exemptions for hospitals and health clinics operated by these institutions. Specifically, they are excluded from certain corporate tax exemptions and VAT exemptions previously applicable to similar social and educational organisations. This change is set to take effect on 1 January 2027.
Free zone manufacturing exemptions
The law expands the scope of tax exemptions for companies operating in free zones. Previously, the corporate tax exemption for manufacturing companies in free zones was primarily focused on sales “abroad.” The amendment to Law No. 3218 expands this to include sales made within the same free zone or to other free zones. This amendment is effective for income obtained starting from 1 January 2026.
