331 TAX LAW • While the exemption is applied up to the amount in the fourth income bracket of the income tax table included in Article 103 of the ITL, the fact that the exemption will not apply in case the limit is exceeded – even by very small amounts – imposes an excessive tax liability on these taxpayers. It can be argued that this situation is contrary to the principle of taxation based on the ability to pay.9 In addition, it is stated that the fairer thing is to exclude the income amount equal to the exemption limit, for all taxpayers in the scope of this regulation.10 • Deliveries subject to income exempted from income tax with Law No. 7338 are exempt from VAT. If it is thought that VAT will be calculated after the part exceeding the exemption limit, it should be clarified what kind of VAT application should be made if the last delivery at the said limit is indivisible.11 • The expression “banks established in Turkey” in Law No. 7338 should be understood as the banks subject to Banking Law No. 5411. However, it is stated that opening an account “in any bank operating in Turkey” should be sufficient to benefit from the exemption.12 Conclusion Through the amendments made with Law No. 7338, social media earnings have been exempted from income tax within certain limits and conditions. However, these earnings are not completely exempted from taxation and are subject to taxation by means of withholding. Thus, the taxes paid by the banks with a 15% withholding on the revenue of social media content producers whose total earnings within a calendar year do not exceed the determined limit will be the final taxes 9 Ergin. 10 Sağlam. 11 Ergin. 12 Başak, Levent: “7338 Sayılı Kanun Kapsamında Sosyal Medya Fenomenlerinin Elde Ettikleri Kazançların Vergilendirilmesi Esasları”, Yaklaşım Dergisi, No. 348, December 2021.
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