Turkey

Taxes on imported luxurious automobiles in Turkey

According to the presidential decision, The Special Consumption Tax (OTV) of luxurious imported automobiles is increased in order to decrease the current deficit and import, to support the local manufacturers.

According to the Ministry of Treasury and Finance, OTV assessments and engine displacement periods are regulated within the presidency decision in Official Gazette. The regulations are for the decrease of the luxurious automobile imports because these imports have negative effects on current deficit. The existent correlations for hybrid automobiles are maintained and their OTV rates are collectively regulated. Tax base increase in domestic automobile categories is expected to make the prices lower in this segment.

An automobile under the sale price of 119 thousand 970 liras including taxes, will not be affected by these new regulations. Duty threshold with a baseline of 45 percent OTV rate is increased from 70 thousand liras to 85 thousand liras. It is estimated that automobile sale prices including taxes between 119 thousand 970 liras and 150 thousand 450 liras will be decreased by 5 thousand liras at most.

Likewise, duty threshold with a baseline of 50 percent OTV rate is increased from 120 thousand liras to 130 thousand liras. It is estimated that automobile sale prices including taxes between 212 thousand 400 liras and 245 thousand 440 liras will be decreased by 15 thousand liras at most.

Also, imported automobiles with engine capacities under 1600 cubic centimetres and over 245 thousand 440 liras of prices including taxes will be affected by these new regulations; their prices will be increased by 12.5 percent.

New regulations are expected to have positive effects on Turkish economy; in this sense, decrease in the demand towards imported automobiles and increase towards automobiles with lower OTV rates, decrease in luxurious automobile imports, increase in domestic automobile sales and decrease in current deficit will be realized within the regulations in fiscal policy.

source: AA / translated by Bazaar Team

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