Presidential Decision No. 10767, published in the Official Gazette on 25 December 2025, reduces the Digital Services Tax (DST) rate from 7.5% to 5% as of 1 January 2026, and further to 2.5% as of 1 January 2027.

The DST was introduced into the Turkish tax system through Law No. 7194, which was published in the Official Gazette on 7 December 2019 and entered into force on 1 March 2020. (For details, see EY Global Tax Alert, Turkey's 7.5% Digital Services Tax to be effective 1 March 2020, dated 15 January 2020) The law established a tax on gross revenues derived from certain digital services and applies broadly to digital advertising, online content sales, digital platform services and similar activities that generate revenue in the digital economy.

Service providers are subject to DST if, in the preceding accounting period, their revenues meet both of the following thresholds:

• Revenues derived in Turkiye from covered digital services exceed 20 million Turkish lira (TRY20m)
• Global revenues exceed €750m or the Turkish lira equivalent thereof

Taxpayers that generate revenues from in-scope services in Turkiye are liable for DST regardless of their residency status or whether they have a permanent establishment in Turkiye.

Prior to Presidential Decision No. 10767, the statutory DST rate was 7.5% of gross revenues derived from in-scope services. Under Law No. 7194, the President had the authority to reduce the DST rate to 1% or increase it to 15%, either for separate types of digital services or for all types of digital services collectively. The President exercised this authority through Presidential Decision No. 10767 published on 25 December 2025 and accordingly:

• As of 1 January 2026, the DST rate is applied as 5%.
• As of 1 January 2027, the DST rate will be further reduced to 2.5%.

The Decision entered into force on the date of its publication and applies to revenues generated as of 1 January 2026, with no retroactive effect on prior periods.