05.08.2024/36
Law No. 7524 Amendments to the Value Added Tax Law
Law No. 7524 on Amendments to Tax Laws, Certain Laws and Decree Law No. 375 was published in the Official Gazette dated 02.08.2024 and numbered 32620.
The regulations regarding the Value Added Tax Law introduced by the said Law are summarized below:
1. Vehicles used in activities such as sightseeing, entertainment, sports and amateur fishing, private boats and yachts will not be accepted as sea transportation vehicles in terms of the services provided in ports.
According to Article 13/1-b of the Value Added Tax Law, services provided at ports and airports for sea and air transportation vehicles are exempt from tax.
With the Law No. 7524, with the parenthetical provision added to the relevant section, vehicles used in activities such as sightseeing, entertainment, sports and amateur fishing, private boats and yachts will not be accepted as sea transportation vehicles in terms of services provided in ports.
Effective: 01.09.2024
2. Exemption for the Import of Certain Goods is Limited.
Article 16/1-b of the Value Added Tax Law stipulates that the import of certain goods listed in Article 167 of the Customs Law No. 4458 is exempt from VAT.
With the regulation made by Law No. 7524, all kinds of vehicles to be imported by the General Staff, the Ministry of National Defense, the force commands, the Undersecretariat of the National Intelligence Organization, the Presidency of Defense Industries, the Gendarmerie General Command, the Coast Guard Command and the General Directorate of Security exclusively in relation to their primary duties and the field of activity of the Machinery and Chemical Industry Joint Stock Company and the Undersecretariat’s anti-smuggling duty, The exemption applied to the import of equipment, weapons, equipment, machinery, devices and systems and their research and development, training, production, modernization and software, spare parts, fuel and lubricants, raw materials, materials and aid materials purchased from foreign sources free of charge and goods for the use of disabled and disabled people has been terminated.
The exemption applied to domestic deliveries of these goods continues.
Effective: 01.11.2024
3.In Merger, Transfer and Division Transactions, the VAT carried forward can be subject to deduction according to the result of the examination.
According to Article 17/4-c of the Value Added Tax Law, VAT transferred in merger, transfer and demerger transactions can be deducted by the transferee taxpayers.
With the amendment made by Law No. 7524, the taxes incurred and not deductible by the taxpayers who cease their activities, divide or dissolve can be made according to the results of the tax inspection to be carried out by the taxpayers who start their activities or who take over the assets of the transferred or divided institutions after the transfer and division, regardless of the statute of limitations regulated in the Tax Procedure Law.
Effective: 02.08.2024
4. VAT that cannot be deducted for five years will be taken into a special account and will be written off as an expense upon examination.
Article 30 of the Value Added Tax Law regulates non-deductible VAT. With the subparagraph added to this article with the Law No. 7524, the value added tax that cannot be eliminated through deduction for five calendar years is determined as non-deductible VAT.
In parallel with this, with the regulation made in Article 58, it is stipulated that the value added tax that cannot be deducted in this way will be removed from the value added tax carried forward to the next period and taken into a special account, and the value added tax carried forward to the next period taken into the special account can be taken into account as an expense in determining the income or corporate tax for the year in which the examination is completed as a result of the tax inspection to be carried out within one year from the date of the request, upon the request to be made by the taxpayers within three years, regardless of the statute of limitations regulated in the Tax Procedure Law.
Effective: 01.01.2030
5. Exemptions for Certain Deliveries and Services to Foreign State Institutions due to the Earthquake.
Law No. 7524 added a provisional article 45 to the Value Added Tax Law.
According to the aforementioned article, the construction of immovables such as housing, workplaces, schools, student dormitories, hospitals, places of worship, cultural and art centers, libraries, etc. to be donated to public administrations with general budgets within the scope of the protocol signed between public administrations with general budgets and foreign state institutions and organizations in the places accepted as disaster zones affecting general life due to the earthquakes that occurred on 6/2/2023;
- Deliveries and services made to foreign state institutions and organizations as of 1/1/2024,
- Delivery to foreign state institutions and organizations of the houses to be donated to public administrations with general budget within the scope of the protocol signed between public administrations with general budget and foreign state institutions and organizations in these places
Exempt from VAT.
Taxes incurred due to deliveries and services made within this scope are deducted from the tax calculated on taxable transactions. Taxes that cannot be compensated through deduction are refunded upon the request of the taxpayer who makes transactions within the scope of the exemption in accordance with the provision of Article 32 of this Law.
Effective: 02.08.2024
You can access the relevant Law here.
Sincerely,
BİLGENER
