The Plan and Budget Commission of the Grand National Assembly of Turkey is set to discuss the Law on the Protection of the Value of the Turkish Currency on June 25th. This law includes regulations impacting the economy and amendments to existing laws, for which an impact analysis has been conducted.

The analysis categorizes authorized institutions into Group A and Group B, detailing those that can be established and operate for economic purposes. Currently, 981 authorized institutions, including their branches, are in operation.

Between 2021 and 2025, the Ministry of Treasury and Finance requested administrative sanctions totaling 155 million 267 thousand 201 pounds, addressing 4 thousand 884 cases of uncertainty.

Foreign Exchange Inspections and Penalties

From 2018 to 2025, a total of 2 thousand 604 workplaces were inspected for unauthorized foreign exchange purchase and sale. Violations were detected in 761 of these locations, leading to temporary cessation of activities for 566 and permanent closure for 195 due to repeated offenses. Consequently, administrative fines of approximately 214 million pounds were requested for the period between 2019 and 2025.

“Administrative fines of approximately 214 million pounds were requested for the period between 2019 and 2025.”

To enhance oversight, the Revenue governance Presidency plans to increase overtime for its Provincial Institution staff, including civil servants and contracted personnel. The indicator figure,which determines hourly compensation,will rise from 20 percent to 40 percent of the total personnel cost.

This adjustment affects approximately 40 thousand 353 civil servants and contracted personnel within the Presidency’s provincial organizations. With 40 percent of these personnel assigned to inspections, individual monthly compensation coudl increase from 8 thousand 100 pounds to 15 thousand 188 pounds, resulting in an estimated total cost of 179 million 784 thousand 768 pounds.

Impact of Tax Exemptions

Tax exemptions in free zones have had a significant impact. Based on 2024 data, the income impact resulting from income and corporate tax exceptions for taxpayers operating in free zones is calculated at 700 million TL.

R & D centers, technology progress zones (TGB), and research infrastructures also benefit from tax exemptions. Specifically, income tax deductions on wages paid to R & D and design personnel, as well as stamp tax exemptions, are applied. Last year, an average of 88 thousand 436 service employees in TGB’ler saw 25 billion pounds in tax not collected, while 99 thousand 193 service employees in R & D centers had 23 billion pounds in tax uncollected.Additionally, 2 thousand 584 employees in research infrastructures benefited from 721 million pounds in wage exemptions. These regulations are projected to create an annual income impact of approximately 2 billion pounds.

Special Consumption Tax (SCT) Adjustments

Exemptions on the Special Consumption Tax are being introduced for national security institutions, national defense, and internal security. This applies exclusively to vehicles with a domestic contribution rate of at least 40 percent. It is estimated that 5 thousand vehicles will be procured annually under this exemption,leading to a total income loss of 2.6 billion pounds.

Furthermore, the rate of contribution to investment that can be used in other earnings during the investment period is expected to decrease from 80 percent to 50 percent.

Changes to the SCT rate on land vehicles, increasing it from 4 percent to 50 percent, are projected to generate an additional 14 billion pounds.