Regulation
Turkey Targets Stocks, Cryptocurrencies with New Tax Laws
Turkey is set to introduce a transaction tax on buying and selling stocks and cryptocurrencies. This was announced by an official. The move is part of Finance Minister Mehmet Simsek’s overall plan to impose tighter fiscal discipline and improve price stability after a tumultuous period of high inflation.
Finance Minister Simsek has already underlined the government’s commitment to creating a fairer tax system. This includes the introduction of a minimum corporate tax. Additionally, President Tayyip Erdogan’s ruling party submitted a bill to parliament last month. Requires cryptocurrency service providers to obtain licenses and registrations. This new regulation marks a significant departure from the previous policy, which reduced the tax on stock profits from 10% to 0% in 2008.
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Economic objectives of the transaction tax
The transaction tax aims to achieve several economic objectives. Burak Cetinceker, money manager at Strategy Portfoy in Istanbul, noted that while the tax may initially have a negative impact on the stock market, it is expected to yield long-term benefits. He believes the new tax could help reduce market volatility, promote a healthier investment environment and limit speculative behavior. He further said:
“In the short term, this looks like pain for the stock market, but in the long term it means a huge gain.”
Stabilize Türkiye’s economy
The planned tax reforms are part of a broader effort to stabilize the Turkish economy. In recent years, Turkey has faced significant economic challenges. This includes the sharp depreciation of the lira and soaring inflation rates. These problems have undermined public confidence in financial markets and led to economic instability. The government hopes these new taxes will restore confidence, attract more sustainable investment and promote balanced economic growth.