Client Alert:

PRESIDENT REDUCES TAX ON FOREIGN CURRENCY PURCHASES FROM 1% BACK TO 0.2%

PRESIDENT REDUCES TAX ON FOREIGN CURRENCY PURCHASES FROM 1% BACK TO 0.2%

This article is one of many articles we have published concerning the legal implications of Covid-19. Please click here for our “Covid-19 Insights” page and other articles.

We have previously shared with our readers that the banking and insurance transactions tax (BITT) rate applied to foreign currency purchases was increased from 0.2% to 1%.

With the Presidential Decree numbered 3031 published in the Official Gazette dated 30 September 2020, the BITT rate is now reduced from 1% back to 0.2%, to be effective from the date of publication of the decree.

The reason given for raising the BITT rate previously was to create additional funds which would be utilised to give more aid to businesses and citizens adversely affected by the Covid-19 outbreak. The fact that this rate is now brought back to its former level can be read as a sign that the normalization process for Turkey has accelerated or will accelerate.

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