Personal Income Tax Law (No: 193) which is about income tax, Social Security and General Health Insurance Law (No: 5510) which is about social security contributions and Unemployment Insurance Law (No: 4447) which is about unemployment insurance fund are the main laws about tax/benefit system.
The main changes have been made to the following laws 5615, 6009, 6327 and 6645 which are as follows:
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According to Act No: 5615, the new application “Minimum Living Relief” began to be implemented. (See the section 1.1.2).
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According to Act No: 6009, the taxation of the wages are differentiated than the taxation of the other taxable revenue resources like trading income, income from immovable property or income from investments. By this way, it is ensured that wages (comparative to other income items) are later entered into the 3rd bracket on the income tax schedule.
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According to Act No: 6327, (published in the Official Gazette issue 28338 on 29 June 2012) there are important amendments in the Private Pension System Regulations. According to this law, any citizen of the Republic of Turkey will have the right for state subsidy for his/her paid contributions to the Private Pension Account. The contribution upper limit to favour this incentive is the annual amount of minimum wage 25% of this amount shall be transferred to the account of the insured party as a state subsidy. The state subsidy shall be earned in proportion to the amount of time within the system.
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According to Act No: 6645, “Minimum Living Relief” rate is changed from 5% to 10% which is used for third child’s rate.
- As of 1st of January 2022, Turkey has abolished the “Minimum Living Relief” and started to implement a Tax Credit system similar to the AngloSaxon income taxation systems. As of 2022 all the wage earners are not liable to pay any taxes up to the gross amount of the monthly minimum wage (TRL 5004) and they are liable to pay taxes for their incomes exceeding this amount.
