November 22, 2019 / 6:27 AM / 2 months ago

Turkey adopts law raising tax revenue from high earners

ISTANBUL, Nov 22 (Reuters) - Turkey’s parliament late on Thursday passed new laws on tax regulations including higher rates for high earners and hotel accommodation, and new taxes on digital services.

The regulation includes a new tax bracket of 40% for those earning more than 500,000 lira ($87,743.93) annually, according to the final text of the regulation. It also increases the Treasury’s net borrowing limit by 70 billion lira for 2019.

In July, Reuters reported Ankara had decided to postpone for a few months the planned tax rises for high earners and ultra-luxury housing sales. Last month, Reuters reported the plan was presented to the parliament.

The tax on accommodation services will be 1% until the end of 2020 and will rise to 2% afterwards. The regulation also sees a 7.5% tax on digital advertising and content.

It doubles a sales tax on foreign exchange to 0.2% and gives President Tayyip Erdogan the authority to raise it to 10 times that amount.

Houses that cost more than 5 million lira will be subject to a valuable residence tax, under the regulation.

Separately on Friday, a new law transferring some of the authorities of the BDDK banking watchdog to the central bank was published in Turkey’s Official Gazette.

The new law gives the central bank oversight over payment systems, including determining costs, expenses, minimum amounts or rates. ($1 = 5.6984 liras) (Reporting by Nevzat Devranoglu; Writing by Ali Kucukgocmen; Editing by Jonathan Spicer)

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