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What Does the Investment Incentive System in Türkiye Mean?

01/12/2023 Investment in Turkey 529 What Does the Investment Incentive System in Türkiye Mean?

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The investment incentive system in Turkey  is a system enacted by the Turkish government to encourage foreign and local investors to invest in the Turkish state. Is this just that? There is more, follow us

The Turkish government has approved a set of programs to encourage foreign and local investors to invest in the Turkish state, as the investment incentive system in Turkey is considered…..

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  • Investment incentives in Turkey are diverse and numerous, offered by the Turkish government to encourage investment in it and attract hard currencies to it, such as the US dollar and the euro. Why are these incentives offered on a regular and variable basis in countries in general? What incentives did the Turkish state rely on to attract this segment of investors?
  • Damas Turk Real Estate always recommends investing in Turkey , due to several main factors that we have noticed through our many years of experience. We also offer investment feasibility for anyone interested in bringing currencies and offering them in the Turkish market in many fields. Follow the article with us to learn together about the types of incentives, their advantages, and other matters related to... Investing in Turkey

What is meant by the Turkish state’s incentives for investments?

  • The system of incentives provided by the Turkish state are laws enacted by the Turkish government that are based on encouraging foreign and local investors to invest in the state in particular and Turkey in general, by promoting business in all sectors of commercial, tourism, economic and real estate.

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  • Certainly, the incentive system benefits both the foreign or local investor and the Turkish government or Turkey. The incentives are constantly changing and are facilitated for one period and tightened for another period, based on data consistent with the Turkish government. The incentive system also has several types that we will learn about later. 

What are the Turkish incentive programs for investments? 

There are four investment incentive programs in Türkiye:

First: Public investment incentive programs 

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Dedicated to public investments within the borders of the Turkish state, the public investment incentives program includes two basic points:

  • Value added tax exemption KATMA DEĞER VERGİSİ 
  • Exemption from customs duties GÜMRÜK VERGİSİ

Second: Regional investment incentive programs “by region”

Here, the government enacts incentives and laws based on the needs of each region and not in general, and they are determined based on the economic growth and capabilities of each region and are based on several basic points, which are:

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  • Value added tax exemption KATMA DEĞER VERGİSİ 
  • Exemption from customs duties GÜMRÜK VERGİSİ
  • Reducing public corporate taxes Kurumlar Vergisi Indirim
  • Support interest rates Faiz Oranı Desteği
  • Social Insurance Support for Social Security Beneficiary Prim Desteği İşveren Payı
  • Support Arazi Tahsis land allocation
  • Social Security Support for Employees Sosyal Sigortalar Prim Desteği Çalışan Payı
  • Income tax deduction support Gelir Vergisi Stopajı Desteği

Third: Strategic investment incentive programs

 Strategic investment incentive programs are offered to investments aimed at local manufacturing of goods that are mainly imported and reducing imports of these goods and include the following points: 

  • Value added tax exemption KATMA DEĞER VERGİSİ 
  • Exemption from customs duties GÜMRÜK VERGİSİ
  • Reducing public corporate taxes Kurumlar Vergisi Indirim
  • Support interest rates Faiz Oranı Desteği
  • Support KDV İadesi value added refund
  • Exemption from KDV value added tax
  • Support Arazi Tahsis land allocation
  • Support Arazi Tahsis land allocation

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Fourth: Investment incentive programs based on the quality of the project

 Investment incentive programs based on the type of project provide many important incentives and points, which are:

  • Value added tax exemption KATMA DEĞER VERGİSİ 
  • Exemption from customs duties GÜMRÜK VERGİSİ
  • Reducing public corporate taxes Kurumlar Vergisi Indirim
  • Support interest rates Faiz Oranı Desteği
  • Support KDV İadesi value added refund
  • Exemption from KDV value added tax
  • Support Arazi Tahsis land allocation
  • Support Arazi Tahsis land allocation
  • Liquidity and financing support Hibe Desteği
  • Tear qualified employees Eğitim Desteği
  • Energy Support Enerji Desteği
  • Capital contribution support Sermaye Katkısı
  • Alım Garantisi Purchase Guarantee
  • Infrastructure support Altyapı Desteği
  • License detailing and other İzin-Ruhsat-Lisans Süreçlerinde Kolaylık

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What are the offers of the Turkish tax incentive system?

There are 10 basic offers that can be used for any investment in Turkey, and they are given to foreigners more than local investors, even starting with exemption from customs duties.

First: Exemption from customs duties

  • Most of the beneficiaries of these exemptions are exporters of Turkish products, machinery and equipment to the rest of the world, because the Turkish government encourages the export of Turkish products to various parts of the world, and therefore it decided to grant a large exemption on the fees for both the KDV value-added tax and also customs duty taxes.

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Second: Reducing investor taxes in Türkiye

  • Here we mean general taxes on the foreign investor in Turkey, and they are proportionate and proportionate, such that the taxes on the investor decrease as the amount allocated for investment in Turkey increases.

Third: Supporting social insurance in Türkiye

  • Most of the factories that are established by foreign investors have a social insurance allowance for their workers. The Turkish government returns the value of these insurances to the investor if he exports these products, for example, or if the field is also commercial. The state returns all social insurance payments to the investor again.

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Fourth: Exemption from income tax for investors in Türkiye

  • The Turkish government also provides incentives by exempting foreigners from income tax in Turkey, or deducting certain percentages from it, so benefiting from this exemption is an advantage to keep investors continuing their investments within Turkey.

Fifth: Interest support from the Turkish government

  • The Turkish government always supports foreign investments and also lends them money, and this is done in installments extending for 5 years or more in order to repay these loans. The government supports investments at rates that may reach more than 50% of the value of the capital, and it also provides lands allocated for investment and within areas Very appropriate

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Sixth: Exemption from value added tax

  • Certainly not completely, but rather with special facilities or certain percentages, especially since this type of tax is the basis for financing the Turkish state. The government returns certain percentages to investors with major investments in Turkey during specific time periods.

What are the advantages of investment incentives in Türkiye?

First: The successful economy in Türkiye

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  • The economic stability that the Turkish state has witnessed over the past ten years, and even the renaissance, is unparalleled in most countries of the entire world. Statistics and records have been truly broken by the Turkish state recently and in all sectors, and today Turkey is among the most powerful economic countries in the world.

Second: Turkey's young infrastructure

  • The advanced infrastructure in Turkey has attracted many international investments in the size of countries, even not just individuals, such as what we witnessed from the construction of the largest medical hospital in Turkey in partnership with the Japanese government, named Cham and Sakura, and other major projects, the largest airport in Europe, Istanbul Airport, the Eurasia Tunnel. , Çanakkale Suspension Bridge, and currently the future Istanbul Canal

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  • Not only in the urban sector, but at the level of all other sectors, such as the military industries, the automobile industry, and other various machines and equipment, also a strong educational infrastructure that Turkey possesses today and other fields.

Third: Supporting scientific research in Türkiye and attracting scientists to it

  • Investment projects that rely on scientific research and development paths receive great attention from the Turkish government, and the government deducts most expenses at rates of up to one hundred percent, in order to encourage scientific investments in Turkey and research of various types.

Fourth: Real estate residency and obtaining Turkish citizenship

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  • Real estate investment in Turkey is one of the investments that has recently succeeded in attracting foreign currencies to a large extent, through the incentives provided by the Turkish government to real estate investors, which are obtaining a real estate residence permit in exchange for purchasing any property, regardless of the value, and also obtaining Turkish citizenship by purchasing A property in Turkey worth 250 thousand US dollars.

What are the most important investment areas in the cities of the Turkish Republic?

There is no single city concerned with investment in Turkey, but rather it is distributed among most of the cities in it, but according to statistics, there is a certain demand for a city rather than others due to the availability of certain components for a specific investment, for example, and we will mention to you the most important cities and investment areas in first place within Turkey.

  • Istanbul city
  • Ankara city
  • Antalya city
  • Bursa city
  • Sakarya city
  • Izmir city
  • Mersin city
  • Adana city
  • Gaziantep city
  • Kocaeli city

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In conclusion

  • Investing in Turkey is safe and profitable as well, and the factors motivating investment in Turkey are truly endless. Logic imposes itself here and says that Turkey has proven itself to be a preferred place to live and invest at the same time. We have collected for you as much private information as possible about investment incentives in Turkey , if You would like to invest in Turkey, click here  to contact you directly

Damas Turk Real Estate Company has many investment opportunities in several areas mentioned in the article here. Do you want to benefit from them? All you have to do is click here  to communicate with the most important consultants in the company. It provides you with complete economic feasibility with a definitely profitable investment, and documented with numbers and analyses.. Contact us and do not hesitate.

References:  invest.gov.tr

Edit:  damasturk

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