2023 Interest Rates to be Applied in Rediscount and Advance Transactions Determined
Article 45 of the Central Bank of the Republic of Turkey Law No. 1211 states that “The Bank, provided that it carries at least two signatures deemed valid, may accept the commercial bills and documents to be issued by banks for rediscount under the principles it determines.” According to this provision, the Central Bank accepts the commercial bills and documents issued by banks for rediscount and meets the temporary liquidity needs of banks. The Central Bank may also provide advances by accepting such bills as collateral for rediscount.
From a tax law perspective, the concept of rediscount is used in relation to the valuation of receivables and payables related to bills. According to Articles 281 and 285 of the Tax Procedure Law No. 213 (VUK), it is stated that receivables and payables related to bills not yet due can be valued at the price on the valuation date. According to these provisions, rediscount transactions are mandatory for banks and insurance companies, while they are optional for others. However, taxpayers who subject their receivables to rediscount must also subject their payables to rediscount. In rediscount calculations, if the interest rate on the bill is not specified, the official discount rates of the Central Bank must be applied.
According to the General Communiqué No. 238 on the Tax Procedure Law, which explains the procedures for rediscount transactions in detail, the discount rate determined by the Central Bank for advance transactions will be applied, and the internal discount method will be used in the rediscount calculation. According to the Communiqué published in the Official Gazette No. 32060 dated 31/12/2023, the discount interest rate to be applied in rediscount transactions for bills with a maturity of no more than 3 months is set at an annual rate of 9.75%, and the interest rate for advance transactions is set at an annual rate of 10.75%.
Accordingly, taxpayers wishing to subject their receivables and payables related to bills to rediscount must apply the 10.75% interest rate for advance transactions using the internal discount method, if the interest rate is not specified on the bill.
You can access the relevant Central Bank of the Republic of Turkey Communiqué here.
Best regards,
BİLGENER
