Türkiye's Finance Minister Kemal Unakitan announced an eight-point financial reform package on Thursday, including the elimination of withholding tax on income and returns earned by non-residents investing in Türkiye's financial markets. The move aligns Türkiye with European Union practices on residence-based taxation of foreign investors.
For domestic investors, the government plans to seek cabinet approval to reduce withholding tax on shares and private-sector bonds from 15 percent to 10 percent. Eurobonds would be exempt from the withholding tax system entirely, while the existing 15 percent rate on deposits and repos would remain unchanged.
Unakitan said the necessary legislative amendment would be submitted to parliament promptly, with the goal of securing approval before the summer recess.
The minister also reaffirmed the government's commitment to fiscal discipline, noting that Türkiye had already achieved 63.1 percent of its year-end non-interest surplus target within the first five months of 2006. He said the government remains on track to hit a 6.5 percent non-interest surplus by year-end and pledged to keep the social security deficit below 4.5 percent of gross national product.
Unakitan added that the government would continue supporting the Central Bank in its effort to reach inflation targets of 4 percent for 2007 and 2008.
Historical summary. TurkishPress restated this wire report, first published in June 2006, in its own words.