309 TAX LAW methods to eliminate the effect of inflation in the determination of the tax base, and it was abrogated in 2004 after the inflation adjustment provisions were included in the tax legislation.1 In today’s practice, all of the enterprises without any differentiation are encouraged to finance their financing needs with capital equity instead of borrowing, and thus, to keep their capital structures strong. The limitation on financing expense deduction imposed during the pandemic when most of the businesses in our country were experiencing financial drought resulted in heated discussions. While the scope of damages that are not included in the technical bankruptcy calculation is expanded with the Communiqué promulgated in the Official Gazette dated 26.12.2020, in order to prevent companies from falling into bankruptcy due to loss of capital, and considering the meltdown in equity capital, timing of the limitation on financing expense deduction was found to be confusing.2 Draft Communiqué on the Limitation on Financing Expense Deduction The Presidential Decree on the limitation on financing expense deduction has raised many questions. Some of these questions were answered with the Draft Communiqué on the Amendment of the General Communiqué on Corporate Tax (Serial No: 19) (“Draft Communiqué”) published on the website of the Turkish Revenue Administration on 24.03.2021. The Draft Communiqué was revised in line with the opinions and recommendations from the public, and was re-shared under the title of the Draft Communiqué on the Amendment of the Corporate Tax General Communiqué (Serial No: 18) (“Updated Draft Communiqué”) on 22.04.2021.3 1 Yıldırım, Mehmet: Finansman Gider Kısıtlaması 17 Yıl Sonra Yeniden Yürürlükte, 05.02.2021, https://t24.com.tr/yazarlar/mehmet-yildirim/finansman-giderkisitlamasi-17-yil-sonra-yeniden-yururlukte,29750 (Access date: 25.04.2021). 2 Yıldırım, Mehmet: fn 1; Sağlam, Erdoğan: Finansman Gider Kısıtlamasına İlişkin Tebliğ Taslağı Güncellendi, 26.04.2021, https://t24.com.tr/yazarlar/ erdogan-saglam/finansman-gider-kisitlamasina-iliskin-teblig-taslagi-guncellendi,30762#_ftn1 (Access date: 27.04.2021). 3 Turkish Revenue Administration, Kurumlar Vergisi Genel Tebliği’nde Değişiklik Yapılmasına Dair Tebliğ Taslağı (Seri No: 18), https://www.gib.gov.tr/sites/de-
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