ANKARA - A decision by the Turkish government reducing private consumption tax on automotive, housing and white goods for three months is likely to take effect on Monday, Turkish industry & trade minister said on Sunday.
"The government decided to lower the private consumption tax to 18 percent from 37 on cars below the capacity of 1600cc," Zafer Caglayan told reporters.
"This is a very important development," Caglayan said.
In an effort to give impetus to Turkey's slowing economy, the government also decided to reduce the private consumption tax to 54 percent from 60 on cars between 1600cc and 2000cc, and to 80 percent from 84 on cars over 2000cc. Tax will be 1 percent instead of 10 percent on light commercial vehicles.
"This fourth package of measures is a very important move to revive domestic demand," Caglayan said.
The package, announced by Prime Minister Recep Tayyip Erdogan on Friday, cuts the value added tax (VAT) taken from the sale of new dwellings. New rate will be 8 percent for three months instead of 18 percent.
In an earlier statement, Turkish State Minister & Deputy Prime Minister Nazim Ekren had said the fourth package would worth around 5.5 billion Turkish liras (TL). (One USD is 1.70 TL)
In a previous package, approved by the Turkish Parliament last month, the government was empowered to reduce some corporate tax on investments, and also cut taxes on textiles and clothing manufacturers if they move their plants to certain cities.
The legislation brought tax relief in landline and wireless internet services to 5 percent from 15 percent and remove tax and traffic fines on 30-year-old or older motor vehicles if they are scrapped until the end of 2009. The legislation also extends to six months from three the period over which the state-run Unemployment Fund can be used to supplement wages at companies that have reduced the number of operating days.
(TÇ-EÖ)
(ECO)