Sign up for tax alert emails    GTNU homepage    Tax newsroom    Email document    Print document    Download document

October 25, 2019

Turkey issues draft Bill to amend various tax laws

On 24 October 2019, the Turkish Government submitted a draft bill to the Turkish Parliament. The new bill introduces new taxes namely, the digital services tax, luxury housing tax and hospitality tax. It also covers changes in income tax rates for individuals’ income. This Alert provides a brief summary of the changes to be introduced by the new draft bill.

Introduction of new taxes

New taxes
Scope of new Tax Bill

Digital services tax

A digital services tax will be introduced at the rate of 7.5% over the revenue derived from certain activities in the digital environment.1

Luxury housing tax

  • A luxury housing tax will be imposed for residential houses located in Turkey with a value of over TL5 million
  • The value of the housing will be determined by the General Directorate of Land Registry and Cadastre
  • The luxury housing tax rates are:
    • Between TL5,000,000 - TL7.500.000: %0.3
    • Between TL7,500,000 - TL10,000,000: % 0.6
    • L10,000,000 and above: %1

Hospitality tax

Accommodation services in hotels, hostels, guesthouse, camping sides and other facilities related with food and entertainment services provided during stays are subject to a hospitality tax rate at 2%. Through temporary article in this draft bill, the hospitality tax rate will be applied 1% until 31 December 2020

Changes in Banking and Insurance Transaction Tax (BITT) applied on money transactions

The BITT rate applied on money transactions is increased to 0.2% from 0.1%.

Increase in withholding tax rates on wages of 1st league Athletes

Athletes that perform activities in 1st league will be subject to a 20% withholding tax on the wages paid to them and if their income bracket falls under the 4th group, they will be required to file an income return.

Changes in income tax rates for individuals

The draft bill proposes a new bracket and tax rate into the income tax rate tariff as follows:

Tax Brackets
Tax Rates

Income other than wages

Up to TL18,000


Up to TL40,000; TL2,700 TL for the first TL18,000 TL, any amount exceeding


Up to TL98,000; TL7,100 TL for the first TL40,000, any amount exceeding


Up to TL500,000; TL22,760 for the first TL98,000, any amount exceeding


Above TL500,000; TL163,460 for the first TL500,000, any amount exceeding


For wages

Up to TL18,000


Up to TL40,000; TL2,700 for the first TL18,000, any amount exceeding


Up to TL148,000; TL7,100 for the first TL40,000, any amount exceeding


Up to TL500,000; TL36,260 for the first TL148,000, any amount exceeding


Above TL500,000; TL159,460 for the first TL500,000, any amount exceeding


People who earn wages of TL500,000 and above annually will now have to file tax declarations.

Unlike being under a payroll, they will be allowed to discount some personal expenses from their tax bases.

Changes in exempted self-employment income

If self-employed taxpayers whose exempted income defined under article 18 of the Income Tax Code No. 193 exceeds the 4th income tax bracket, they will no longer be subject to this exemption. These taxpayers will have to file a tax return not only for the parts exceeding the 4th bracket but also for all income previously under exemption.


1. See EY Global Tax Alert, Turkey introduces digital service tax, dated 25 October 2019.

For additional information with respect to this Alert, please contact the following:

Kuzey Yeminli Mali Müsavirlik ve Bagimsiz Denetim A.S. Istanbul



The information contained herein is general in nature and is not intended, and should not be construed, as legal, accounting or tax advice or opinion provided by Ernst & Young LLP to the reader. The reader also is cautioned that this material may not be applicable to, or suitable for, the reader's specific circumstances or needs, and may require consideration of non-tax and other tax factors if any action is to be contemplated. The reader should contact his or her Ernst & Young LLP or other tax professional prior to taking any action based upon this information. Ernst & Young LLP assumes no obligation to inform the reader of any changes in tax laws or other factors that could affect the information contained herein.


Copyright © 2024, Ernst & Young LLP.


All rights reserved. No part of this document may be reproduced, retransmitted or otherwise redistributed in any form or by any means, electronic or mechanical, including by photocopying, facsimile transmission, recording, rekeying, or using any information storage and retrieval system, without written permission from Ernst & Young LLP.


Any U.S. tax advice contained herein was not intended or written to be used, and cannot be used, by the recipient for the purpose of avoiding penalties that may be imposed under the Internal Revenue Code or applicable state or local tax law provisions.


"EY" refers to the global organisation, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients.


Privacy  |  Cookies  |  BCR  |  Legal  |  Global Code of Conduct Opt out of all email from EY Global Limited.


Cookie Settings

This site uses cookies to provide you with a personalized browsing experience and allows us to understand more about you. More information on the cookies we use can be found here. By clicking 'Yes, I accept' you agree and consent to our use of cookies. More information on what these cookies are and how we use them, including how you can manage them, is outlined in our Privacy Notice. Please note that your decision to decline the use of cookies is limited to this site only, and not in relation to other EY sites or Please refer to the privacy notice/policy on these sites for more information.

Yes, I accept         Find out more