Foreigners remain exempt from taxation
07 February 2008
Undersecretary of the Finance Ministry Hasan Basri Aktan said that the ministry has no intention of annulling withholding tax immunity for foreign investors, Today's Zaman reports.
Last week a tax court in Ankara decided to refer a case on the issue to the Constitutional Court on grounds that applying different rates to investors was in contravention of the principle of equality as enshrined in the Constitution.
The government had decreased the withholding tax rates to nil for foreign investors to guarantee their interest in the Turkish markets but kept the rate at 10 percent for the local investors.
"The current application is compatible with the tax law, tax methodology and established practices. It is continuing today the same way as it has been continued so far. No one should be worried," Aktan said.
The Federation of Consumer Associations (TÜDEF) and the Republican People's Party (CHP) had filed a lawsuit demanding annulment of the practice with the Constitutional Court, The court is expected to handle the situation in a few weeks' time.