Turkey - New Tax Rules for Cross-Border Transactions

With its geographical position, Turkey has always been the center of trade. Following modern trends, it remains an important market in the digital age. The e-commerce market in Turkey is growing rapidly, and spending has doubled in the last year. 

However, when reviewing this information, we must remember that Turkey has been fighting inflation for years, and part of this growth has resulted from inflation.

The Turkish government has adopted new tax rules for cross-border transactions, which is expected to significantly benefit domestic companies by protecting them from foreign online stores.

Impact of the New Rules

These new rules introduce two fundamental changes: an increase in customs tax and a reduction in the exemption threshold.

In Turkey, there are two customs taxes: imports from the European Union (EU) and imports from other countries. Both of these taxes are increased from 20% to 30% on imports from the EU and from 30% to 60% on imports from other countries.

In addition, the Turkish government decided to lower the exemption threshold for imported goods delivered to individuals by mail or express cargo from EUR 150 to EUR 30. Medical goods valued at up to EUR 1,500 are exempt from these rules. 

All goods valued over EUR 30 and medical goods above EUR 1,500 are subject to increased tax rates.

Furthermore, a 20% extra tax will be applied on luxury products and other goods that fall under the category specified in the Special Consumption Tax Law. 

These new will come into effect on August 21, 2024.

Conclusion

Even though the primary goal of these changes is to protect the domestic market and local e-commerce companies from the competition posed by foreign online stores, such as AliExpress or Temu, they will limit citizens' options for online shopping. 

Source: PwC, E-commerce News