Turkey will raise corporate taxes to fund the recovery from major earthquakes that struck the country in February, according to a draft law presented to parliament by President Tayyip Erdogan’s ruling AKP (Justice and Development Party.)
In response to the devastating earthquakes that struck southern Turkey earlier this year, the AKP has presented a draft law to parliament, outlining a plan to raise corporate taxes in order to fund the country’s recovery efforts. The earthquakes, which resulted in the loss of over 50,000 lives and left millions homeless, have prompted the government to estimate that the rebuilding process could cost more than $100 billion.
As part of the government’s commitment to assisting those affected by the disaster, they have pledged to rebuild over 600,000 homes for the displaced population. However, the enormous financial burden necessitates creative solutions, and the proposed tax increases are one way in which the government plans to generate the required funds.
The draft law includes a provision to raise corporate taxes from the current rate of 20% to 25%. Additionally, banks and financial institutions will see their corporate tax rates increase from 25% to 30%. These measures are expected to contribute significantly to the government’s efforts to secure the necessary resources for reconstruction.
In a bid to support foreign trade and boost the country’s economy, the bill also includes provisions for a corporate tax discount of five percentage points on export income. This move aims to incentivize companies to engage in international trade and promote economic growth through increased exports.
Furthermore, the proposed legislation includes a transfer of the treasury-run portion of the forex-protected lira deposit accounts scheme to the central bank. This scheme operates by compensating lira depositors for losses incurred due to currency depreciation. With this transfer, the central bank will assume responsibility for managing the scheme, ensuring its continued effectiveness.
President Erdogan’s government has been resolute in its commitment to addressing the aftermath of the earthquakes and supporting those affected. The draft law’s provisions to raise corporate taxes and incentivize exports demonstrate a proactive approach to tackling the financial challenges associated with the rebuilding process.
Gerçek News