Significant Amendments on Some Tax Laws Entered into Force Through the Promulgation of the Law No. 7417

Through the Law No. 7417 on the Amendment to the Civil Servants Law, Certain Laws and Decree No. 375 ("Law No. 7417") which is published in the Official Gazette dated 5th July 2022 and No. 31887, significant amendments within Law No. 6183 on the Procedure for the Collection of Public Receivables (“PCPR”), Tax Procedural Law No. 213 (“TPL”),  Corporate Tax Law No. 5520 (“CTL”) and Law No. 7394 on the Amendments of Treasury-Owned Immovable Property Valuation and the Value Added Tax Law and on the Amendments of Certain Other Laws and Decrees (“Law No. 7394”) are entered into force.

Amendments within CTL

Effective date of corporate tax rate for financial institutions

As is known, through Law No. 7394, the corporate tax rate to be applied to the corporate income of companies within the scope of the Law No. 6361 on Financial Leasing, Factoring, Finance, and Savings Finance Companies, banks, electronic payment and money institutions, authorized foreign exchange institutions, asset management companies, capital market institutions, insurance, and reinsurance companies and pension companies, had been increased to 25%. Through Law No. 7417, it has been regulated that the aforementioned rate will also be applied to the corporate income for the taxa periods following the year of 2023.

Amendments within TPL

Increase in special irregularity fine

The amount of special irregularity fines applied for not giving or receiving invoices and similar documents within Article 353/1 of TPL has been increased. Accordingly, the fine for not issuing invoices and similar documents is determined as 1,000 TL, the fine for each determination regarding each type of document is determined as 50,000 TL, and the maximum total fine for each document type in a calendar year is determined as 500,000 TL.

Within Article 355 bis of TPL, the special irregularity fines to be applied to those who do not fulfill their obligation to preserve and present certain information and notification in the electronic environment are determined as 5 times for first class merchants and members of independent professions, 3 times for second class merchants, and 2 times for persons other than those stated above.

Authorization regulation on ultimate beneficial ownership application

Within Article 257/1-9 bis of TPL, determining the procedures and principles of the ultimate beneficial ownership application has been added to the authorities of the Ministry of Treasury and Finance.

Amendments within PCPR

Inclusion of surety bonds into the scope of guarantees 

Within the scope of guarantees regulated under Article 10/1-2 of PCPR, the expression "Perpetual guarantee letters given by banks and private finance institutions" is changed to "Perpetual and unconditional guarantee letters given by banks; and perpetual and unconditional surety bonds given by insurance companies". In this context, surety bonds issued by insurance companies are accepted as guarantees.

Among the regulations within the scope of Law No. 7417; (i) the regulation on the increase in special irregularity fines enters into force on 1st August 2022,

(ii) other regulations enter into force on the date of publication (5th July 2022).

You may find the full text of Law No. 7417 here (Turkish).