ANNOUNCEMENT 31 Jul 2020

On 31 July 2020, the government of Turkey temporarily reduced the VAT rate in certain services sectors.

NUMBER OF INTERVENTIONS

1

  • 1 harmful
  • 0 neutral
  • 0 liberalising

SOURCE

Official gazette of Turkey, Presidential Decrees, “Mal ve Hizmetlere Uygulanacak Katma Değer Vergisi Oranlarının Tespitine İlişkin Kararda Değişiklik Yapılmasına Dair Karar (Karar Sayısı: 2812)”, [Amendment on the Value Added Tax Rates Applicable to the Goods and Services (Number of Decisions: 2812)]. Available at: https://www.resmigazete.gov.tr/eskiler/2020/07/20200731-4.pdf

Inception date: 31 Jul 2020 | Removal date: 31 Dec 2020

Tax or social insurance relief

On 31 July 2020, the government of Turkey temporarily reduced the VAT rate in certain services sectors. The decision is taken to mitigate the adverse effects of the Coronavirus pandemic in the economy.

With respect to the tourism sector, with the new regulation, the VAT rate on accommodation services, and food and beverage serving services is reduced from 8% to 1%, and the VAT rate on passenger transport services is reduced from 18% to 8%.

Apart from the tourism sector, the government also reduced the VAT rates on recreational and cultural services, wedding and event organization services, cleaning services and etc.

The regulation enters into force on 31 July 2020 and expires on 31 December 2020.

 

AFFECTED SECTORS

 
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AFFECTED PRODUCTS

 
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