VAT coming to digital codes: Price hikes for games, music, and movies

With the "Communiqué on Amendments to the General Application Communiqué on Value Added Tax" published in the Official Gazette, changes have been made to the VAT application for the sale of cards, passwords, codes, and similar items.

According to the communiqué, it is stated that the import or sale in Turkey of certain cards, passwords, and codes, whether in a virtual environment or physically, is subject to VAT. Individuals making purchases from abroad will be required to declare and pay this through a VAT return. For products purchased by individuals who are not VAT taxpayers from electronic service providers abroad, the VAT payment will be made by the foreign company. In cases of buying and selling within Turkey, the VAT will be declared by the seller.

The situation is slightly different for products such as wallet codes or gift cards. Since these products do not have a direct equivalent and are used as payment instruments, they will not be included in the VAT application. However, VAT will be calculated on the purchase and sale of codes that are directly valid for a specific game or that grant access or subscription rights to a game. Nevertheless, VAT will not be applied to wallet codes valid in stores. For free games, no VAT will be calculated, or it will be 0 if calculated.

These changes will come into effect as of March 1, 2024.

News Source: 12punto