Turkey is gearing up to implement new taxes, including a 0.03% transaction tax on cryptocurrency trading, as part of a major fiscal overhaul. The objective is to tackle the country’s budget deficit stemming from the 2023 earthquakes and propose a different approach to financial transaction regulation.
As per a report from Bloomberg, the introduction of a transaction tax on crypto trading could bring in significant revenue during challenging economic times. The Turkish government’s proposed tax reforms are projected to generate 226 billion liras ($7 billion), approximately 0.7% of the country’s gross domestic product. The Ministry of Treasury and Finance, under the leadership of Mehmet Simsek, has drafted legislation for parliamentary deliberation by the end of June.
The implementation of the 0.03% transaction tax aims to capitalize on the increasing interest in crypto trading among Turkish investors looking to safeguard themselves against inflation and currency devaluation. These reforms would represent the most significant tax overhaul in Turkey in the last twenty years.
Despite initially refuting plans to tax crypto and stock gains, the Turkish government is now contemplating targeted transaction taxes to ensure comprehensive financial regulation. Simsek announced on June 5 that Turkey intends to “tax every area in order to ensure fairness and efficiency in taxation.”
Previously dismissed proposals to levy taxes on crypto and stock gains included the notion of “very limited” transaction levies. President Recep Tayyip Erdogan’s ruling party, which holds a parliamentary majority, is expected to pass the proposed legislation and enforce the new 0.03% transaction tax. However, past efforts to implement transaction taxes have encountered significant opposition, and political conflict is expected with this latest endeavor.