Omnibus bill proposing increases in taxes, premiums, and fees accepted: Exemptions ending, new fees introduced

With the proposal signed by AKP deputies, amendments are being made to the Income Tax Law. Accordingly, the exemption regarding residential rental income obtained by those who rent out their properties as residences within a calendar year is being reorganized for those receiving retirement, disability, widow's, or orphan's pensions from social security institutions established by law. This provision will enter into force on January 1, 2026.

It is aimed to eliminate the difference in tax burden between those who purchase real estate with or without credit, as those who rent out real estate purchased using credit have the opportunity to deduct the interest paid for these loans as an expense when declaring rental income; to direct savings toward productive investments; and to prevent the erosion of the tax base caused by considering debt expenses incurred for wealth acquisition as an expense in determining taxable income.

Accordingly, excluding residences, interest on debts incurred for rented goods and rights, and 5 percent of the acquisition cost of one real estate rented out as a residence can be deducted for 5 years starting from the year of acquisition. This provision will enter into force on the date of publication of the regulation to be applied to 2025 income and earnings.

The earnings of taxpayers with temporary tax liability can be determined in 3, 6, 9, and 12-month periods. Thus, the fourth temporary tax period will be included in the system, ensuring that a temporary tax return containing the operating results of this period is received. This provision will enter into force on the date of publication of the regulation to be applied to 2025 income and earnings.

For funds whose portfolio consists of at least 51 percent of stocks traded on Borsa Istanbul, whose participation shares can only be sold to qualified investors, which are not traded on the Turkish Electronic Fund Trading Platform (TEFAS), and which are not subject to any proportional limitation regarding the assets and transactions to be included in the fund portfolio, the withholding exemption based on a one-year holding period will not be applied. Participation share holders of funds other than these, whose portfolio consists of at least 51 percent of stocks traded on Borsa Istanbul, will continue to benefit from the said exemption.

EXEMPTION AND FEE REGULATIONS

According to the amendment made to the Motor Vehicles Tax Law with the regulation, investment monitoring and coordination departments established in place of provincial special administrations in metropolitan provinces will be exempt from motor vehicles tax for vehicles registered in their names, just as in provincial special administrations.

According to the regulation made in the Law on Fees, investment monitoring and coordination departments will be exempt from title deed fees in real estate acquisitions and sales, just as in provincial special administrations.

After the transaction made at the land registry, if it is determined that a fee was paid over a value lower than the real estate tax value or that the declared transfer and acquisition price does not reflect the actual situation, the tax loss penalty will be applied as "one-fold" instead of 25 percent in the assessment of the fee corresponding to the difference.

According to the amendment made in the "relative fees taken over value or weight" section in the tariff attached to the Law, a relative notary fee will be charged over the sale and transfer price, not less than 1000 liras, for the first registration transactions of zero-kilometer vehicles made at the notary and for the sale and transfer transactions of registered vehicles (second-hand vehicles). This provision will enter into force on January 1, 2026.

In the transfer and acquisition of real estate in return for consideration, based on a lifetime care agreement, or according to barter provisions, the rate in the provision will also be applied to the transfer and acquisition price declared, not less than the real estate tax value of the real estate (in cases of forced execution and partition, over the sale price; in expropriations, over the appraised value) separately for the transferor and the transferee, and in the transfer of real estate not registered in the land registry with possession transfer agreements.

With the draft law, annual fees will be charged for documents belonging to private health institutions providing outpatient diagnosis and treatment and private health institutions providing oral and dental health services, which are currently not subject to fees, licenses given to veterinary clinics and polyclinics and animal hospitals, precious metals establishment and activity authorization documents, jewelry, second-hand motor land vehicle and real estate trade authorization documents, and commercial airline and general aviation operating licenses. Currently, the fee for licenses issued to open private hospitals and laboratories, which are subject to fees only upon obtaining a license, and tourism establishment certificates will be charged annually.

Accordingly, 30 thousand liras will be charged for authorization documents issued on behalf of jewelry businesses, including branches, to engage in jewelry trade for each year, and 20 thousand liras for authorization documents issued on behalf of businesses, including branches, to engage in second-hand motor land vehicle trade, and for authorization documents issued on behalf of businesses and contracted businesses, including branches, to engage in real estate trade. These fees will be applied with a one-fold increase in provinces with metropolitan municipalities, excluding districts with a population not exceeding 30 thousand according to the latest data published by the Turkish Statistical Institute (TÜİK) as of the last day of the previous calendar year.

Licenses to open private hospitals and licenses for laboratories will also be charged for each year. Establishment authorization documents given to private food control laboratories will also be added to the licenses for laboratories.

Within the scope of licenses for private health institutions providing outpatient diagnosis and treatment, the examination room compliance certificate will be 20 thousand liras, the private polyclinic license 30 thousand liras, and the private medical center license 50 thousand liras for each year. Within the framework of licenses for private health institutions providing oral and dental health services, the fee to be charged for each year will be 20 thousand liras for oral and dental health examination rooms, 30 thousand liras for oral and dental health polyclinics, 40 thousand liras for oral and dental health centers, and 40 thousand liras for oral and dental health hospitals.

These fees will be applied with a one-fold increase in provinces with metropolitan municipalities, excluding districts with a population not exceeding 30 thousand according to the latest data published by TÜİK as of the last day of the previous calendar year.

Within the scope of tourism establishment certificates, the fees paid for first, second, third, and fourth-class tourism establishment operating certificates will also be charged annually.

The fee to be charged within the scope of licenses given to examination rooms, polyclinics, and hospitals where animals are examined and their diseases are diagnosed and treated will be applied as 10 thousand liras for veterinary examination room license, 20 thousand liras for veterinary polyclinic license, and 40 thousand liras for animal hospital license for each year.

The fee amount will be 7 million 500 thousand liras for precious metal refinery establishment authorization documents, 7 million 500 thousand liras for precious metal refinery activity authorization documents for each year, and 5 million liras for precious metals intermediary institution and organization activity authorization documents for each year.

Airline and general aviation operating license fees are also being regulated. Accordingly, the fee to be charged for each year will be applied as 2 million liras for licenses given to airline companies that will carry passengers and cargo with scheduled and unscheduled flights, 1 million 500 thousand liras for licenses given to airline companies that will carry passengers and cargo only with unscheduled flights, 1 million liras for licenses given to airline companies that will carry only cargo with scheduled and unscheduled flights, 500 thousand liras for air taxi operating license fee, and 100 thousand liras for general aviation operating license.

This provision will enter into force on January 1, 2026.

RULES REGARDING THE UPDATING OF FEES IN PRIVATE UNIVERSITIES

With the amendment made to the Higher Education Law, rules regarding the updating of fees determined by the board of trustees in foundation higher education institutions are being established. Accordingly, tuition fees other than the year of placement in the preparatory class and/or first year will be according to the principles to be determined by the Council of Higher Education, also taking into account the average of the annual producer price index increase in June of the current year and the annual consumer price index increase in June of the current year.

According to the amendment made to the Highway Traffic Law, the fee exemption regarding the sale and transfer transactions of registered vehicles (second-hand vehicles) carried out by notaries will be abolished. This provision will enter into force on January 1, 2026.

According to the regulation made in the Value Added Tax Law, transfers and deliveries realized through the sale of real estate owned by investment monitoring and coordination departments will be exempt from VAT. This provision will enter into force at the beginning of the month following the publication of the regulation.

For the 2026 UEFA Europa League Final and 2027 UEFA Conference League Final matches and the 2032 UEFA European Football Championship organization, the Union of European Football Associations (UEFA), participating teams, and legal entities involved in the organization whose workplace, legal, and business center are not in Turkey will be exempt from value added tax for the delivery of goods and services to be made due to these matches and organization, and for the delivery of goods and services they will make due to these matches and organization. Taxes borne due to these exemptions will be deducted from taxes calculated on taxable transactions. Taxes that cannot be compensated through deduction will be refunded in cash or by set-off upon the request of the taxpayer acting within the scope of the exemption in accordance with the relevant provisions. The Ministry of Treasury and Finance will be authorized to determine the procedures and principles regarding the application of the exemption and refund.

According to the provision added to the Coastal Law, structures and facilities can be built in the Middle Black Sea Free Zone area, whose boundaries and coordinates are shown in the sketch and list, in order to carry out industrial, commercial, and service-related activities in accordance with the Free Zones Law.

With the proposal, according to the Law on the Individual Pension Savings and Investment System, the amount corresponding to 30 percent of the contributions paid to the individual pension account on behalf of Republic of Turkey citizen participants, excluding those paid by the employer, and participants within the scope of the relevant provision of the Turkish Citizenship Law, will be calculated by the Pension Monitoring Center as a state contribution based on the information transmitted by companies to the Pension Monitoring Center. The proposal gives the President the authority to increase this rate up to 50 percent and decrease it to zero.

With the regulation, it is aimed to increase the net borrowing amount determined by the annual budget law at the beginning of the year in order to meet the additional financing need arising due to expenditures made to reduce the economic and social effects of the earthquake disaster experienced in 2023 and income-oriented budget developments in 2025, and to keep the Treasury cash reserve at a certain level.

For this purpose, according to the temporary article added to the Law on the Regulation of Public Finance and Debt Management, the net borrowing amount regulated in the provision will be applied for 2025 by adding 595 billion liras to the net borrowing amount increased by the Minister and the President, effective from January 1, 2025.

With the draft law, it is aimed to increase the habit of insured persons to pay their premiums within the legal period by keeping the revival cost of the stopped insurance period higher than the premium cost paid within the legal period, and to ensure that our insured persons who pay their premium amounts on time do not fall into a disadvantaged position by making amendments to the Social Insurance and General Health Insurance Law. It is also aimed to ensure equality among insured persons by taking the borrowing premium rates as 45 percent for insured persons to whom the provisions of the Republic of Turkey Pension Fund Law are applied.

News Source: 12punto