The corporate tax rate for producers and exporters in Turkey will be 22% instead of 23%.
Article 15 of the Law No. 7351 (The Law on the Law on the Private Pension Savings and Investment System, and on the Amendment of Certain Laws and Decrees) published in the Official Gazette of the Türkiye dated January 22, 2022 and numbered 31727 and the “corporate tax and 7th, 8th and 9th paragraphs have been added to article 32 titled “temporary tax rate”.
With the newly added clauses, as of January 1, 2022, the corporate tax rate will be applied as 22% instead of 23% for the earnings of exporters and producers subject to corporate tax.
Accordingly, 1 point discount;
– It will be applied for the portion corresponding to the earnings of the exporting organizations from exports.
-For manufacturers; It will be applied only for the part corresponding to the earnings obtained from the production activities of the establishments that have the industrial registration certificate and are actually engaged in production activities. In case the enterprise is an exporter as well as a producer, the portion of these earnings corresponding to the exports of the producers is not discounted.
-The corporate tax will be applied as 23% for the profits that the manufacturers and exporters will derive from their activities other than the reduced corporate tax. For this reason, it would be beneficial for KV taxpayers to make their records in such a way that they can make this distinction.
As of January 2022, the number of active corporate taxpayers is approximately 992 thousand in Türkiye. The number of taxpayers with manufacturer qualifications and industrial registration certificate varies between 155 and 160 thousand, while the number of corporate taxpayers with exporter certificates varies between 85 thousand and 90 thousand. It is expected that approximately 250 thousand taxpayers will benefit from the 1-point corporate tax reduction.
– While the corporate tax rate in Türkiye was 20% (KVK art. 32) until 2017, it was applied as 22% in 2018, 2019 and 2020 (KVK Temporary Article 10). The rate to be applied for 2021 earnings is 25%, and it will be applied as 23% for 2022 and 2023 earnings.
As of the end of 2019, the tax base (the amount by which the tax is calculated) declared in the declarations of approximately 825 thousand corporate taxpayers is approximately 499 billion 391 million TL and the corporate tax accrued on these is 98 billion 314 million TL.
Ali KARAKUŞ
CPA and Independent Auditor
Istanbul, 21 February 2022
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