Value-added Tax Reform After 35 Years

To build a strong financial structure, it is necessary to have natural resources or industrialization and also a fair tax system. Tax policy is the first priority for Turkey. The Value Added Tax (VAT), which entered into force on 1 January 1985, has been converted into a system where the minimum tax is paid to the treasury with the help of the self-employed persons who are generally given the public power. The state did not have to settle for it. In 35 years it is necessary to abandon the system which cannot result in economic efficiency. In the new method, final consumption expenditures and taxes on imports are directly paid to the Treasury without any reimbursement or reductions. In addition to the reform, use of counterfeit documents in the sector will end, 1% The state’s right to buy will prevent leaks in the sector and the public will be relieved when the tax rate drops. External credit demand and import activity will decrease, national production and exports will increase, value added tax will be added to income and corporate tax base and the system will be simplified. With this new method, the budget deficit will close, with some 70.000.000.000 Turkish Lira additional funding, some other social projects will be easier to implement.