321 TAX LAW if the purchase and sale of goods between related parties falls under Article 1 of the VATL, the purchase and sale of goods is also subject to VAT. However, considering the new rules created when the CTL entered into force, some discussions have arisen regarding VAT in cases where the transfer pricing regulations have to be put into practice, since the necessary explanations are not made in the VATL. Namely, as stated in the section above, the deduction of the disguised profit distributed through transfer pricing is not allowed in the determination of corporate income under Article 11(1)(c). On the other hand, in the old version of Article 30 of the VATL, there was a clause which stated that VAT paid “due to expenses whose deductions are not accepted in the determination of income according to Income and Corporate Tax laws”. Under this version of the law, since the disguised profit distribution was an expense that was not accepted by law, the deduction of the VAT paid was not accepted. For this reason, many problems occurred in practice. The legislature, which was not indifferent to this problem, made changes in related communiqués and the VATL in successive years. The relevant changes are as follows:4 The Communiqué (Serial No: 6) on the Amendment to the Communiqué on Value Added Tax General Application This Communiqué has eliminated the need to make any adjustments in the deduction accounts regarding the taxes that are paid excessively or improperly due to the deductions in the import base of taxpayers who have the right to deduction (including the cases where it is determined that disguised profits are distributed through transfer pricing). 4 Çelik, Tolga: “Transfer Fiyatlandırması Yoluyla Örtülü Kazanç Dağıtımının Katma Değer Vergisi Kanunu Karşısındaki Durumu”, Vergi Dünyası Dergisi, Year 39, No: 459, November.
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