Author: Russo-Turkish Legal & Consulting Company – International Lawyer, Business Attorney and Arbitration Specialist
Date: 28 April 2026
Dear European partners, investors and corporate clients,
On 24 April 2026, President Recep Tayyip Erdoğan unveiled a comprehensive investment and tax reform package under the “Türkiye Century: Strong Center for Investment Program” (Türkiye Yüzyılı Yatırım İçin Güçlü Merkez Programı).
The initiative aims to position Türkiye as a leading global hub for capital, exports, regional headquarters and high-net-worth individuals.
Important disclaimer: The proposals have not yet been enacted into law.
The draft legislation has not been submitted to the Turkish Parliament (TBMM) nor published in the Official Gazette (Resmî Gazete).
We strongly recommend waiting for the official text before taking irreversible steps.
1. Current Tax Rates in 2026 (as of April)
Corporate Income Tax (Kurumlar Vergisi): standard rate 25% (30% for banks and financial institutions).
VAT (KDV): standard 20%, reduced rates 10% and 1%.
Personal Income Tax: progressive up to 40%.
Digital Services Tax: reduced to 5% from January 2026.
Dividend Withholding Tax: 15%.
Inflation Adjustment (Enflasyon Düzeltmesi): postponed for 2025–2027 periods.
Pillar Two (global minimum tax) is fully implemented.
2. Key Proposed Incentives in the New Package
For Exporters
Manufacturing exporters: corporate tax reduced to 9%.
Other exporters: corporate tax reduced to 14%.
Istanbul Financial Center (İFM / IFC) Enhancements
100% exemption on profits from transit trade and intermediary overseas trading activities (currently 50%).
Outside the Center: 95% of such profits exempt from corporate tax.
Strong incentives for companies managing regional or global operations from Türkiye.
For New Tax Residents (Individuals and Legal Entities)
Persons who have not been Turkish tax residents in the last 3 years: 20-year full exemption from Turkish tax on foreign-source income and capital gains. Only Türkiye-sourced income will be taxed.
Inheritance and Gift Tax: flat rate of 1% (instead of progressive up to 30%).
Additional Measures
8th Wealth Amnesty (Varlık Barışı) – repatriation of foreign assets at favourable rates.
One-Stop Office – simplified procedures for company registration, permits, visas and incentives.
Service exports (architecture, engineering, software, etc.): 100% exemption on foreign income.
Why This Package Matters for European Companies and Investors
Türkiye already serves as a strategic bridge between Europe, the Middle East, Central Asia and Africa.
The new measures significantly enhance its attractiveness:
Lower effective taxation for manufacturing and export-oriented operations.
Competitive non-dom regime comparable to leading international hubs.
Expanded opportunities in the Istanbul Financial Center for trading, treasury and headquarters functions.
Simplified access for EU-based groups seeking to optimise supply chains and regional management.
Practical Recommendations from an International Lawyer and Financial Consultant
Begin preparatory work now: company formation, bank account opening, substance planning.
Conduct tax residency and double tax treaty (DTA) analysis (Türkiye has an active DTA with most EU countries).
Ensure compliance with economic substance, MASAK (AML) and OECD requirements.
Prepare applications for İFM participation, exporter incentives and One-Stop Office services.
Russo-Turkish Legal & Consulting Company
Russo-Turkish Legal & Consulting Company provides full-cycle support for European clients: corporate structuring, tax optimisation, incentive applications, contract drafting, arbitration and ongoing compliance.
Contact us for a personalised assessment
Türkiye: +90 (552) 647-07-17
Europe / Russia: +7 (812) 210-00-77
We will continue to monitor developments and publish updates as soon as the official legislation appears in the Resmî Gazete.
Türkiye is actively building a competitive investment ecosystem.
Businesses that prepare today will secure a significant advantage tomorrow.
This article is for informational purposes only and does not constitute individual legal or tax advice.