INVEST IN TURKEY
INVESTMENT INCENTIVE PRACTICES
Investment Incentive Practices
a) Investment Incentive System
- Purpose and Relevant Legislation
- Support Elements
- Investment Incentive Applications - Support Rate and Duration
- 6th Region Supports
b) Attraction Centers Program
c) Moves Program
INVESTMENT INCENTIVE SYSTEM
Investment Incentive Legislation
Investments are supported within the framework of the Decree of the Council of Ministers and the provisions of the communiqué regarding the implementation of this Decision.
▪ “Decision on State Aids in Investments” No. 2012/3305 (Official Gazette dated 19.06.2012)
▪ Implementation Communiqué No. 2012/1 (Official Gazette dated 20.06.2012)
Purpose of Investment Incentive System
▪ Increasing the production of intermediate goods and products with high import dependency in order to reduce the current account deficit,
▪ Supporting high and medium-high technology investments that will enable technological transformation,
▪ Increasing the investment supports provided to the least developed regions,
▪ Reducing regional development disparities,
▪ Increasing the effectiveness of support elements,
▪ Supporting cluster activities.
SUPPORT ELEMENT IN INVESTMENT INCENTIVE SYSTEM
VAT EXCEPTION
➢ It is applied in the form of non-payment of value added tax for investment goods, machinery and equipment to be procured from Turkey and abroad within the scope of Investment Incentive Certificate, and software and intangible rights sales and rentals within the scope of the certificate.
➢ Building-construction expenditures made within the scope of the document in the manufacturing and tourism sector can be benefited from VAT exemption until 31/12/2025.
CUSTOMS TAX EXEMPTION
It is applied in the form of non-payment of customs duty for investment goods machinery and equipment to be procured from abroad within the scope of the Investment Incentive Certificate.*
* For machinery and equipment to be imported within the scope of investment incentive certificates issued based on applications made as of 29/6/2021, customs duty exemption is not applied for machinery and equipment specified in ANNEX-8 of Decision No. 3305. The machinery and equipment in question cannot be procured as used or refurbished within the scope of the incentive certificate.
TAX REDUCTION
Tax Reduction; It is the application of income or corporate tax at a discount until the contribution amount foreseen for the investment is reached.
This support is provided within the scope of incentive certificates issued within the framework of strategic investments, regional incentive practices and priority investments incentive practices.
INTEREST OR DIVIDEND SUPPORT
➢ It is a financial support provided for loans with a maturity of at least one year used within the scope of the Investment Incentive Certificate.
➢ Our Ministry covers a certain part of the interest or dividend payable for the loan used up to 70% of the fixed investment amount registered in the incentive certificate.
➢This support element is applied for investments to be made within the scope of strategic investments, regional incentives and priority investment incentive applications in the 3rd, 4th, 5th and 6th Regions.
INVESTMENT PLACE ALLOCATION
➢ For strategic investments, regional and priority investments for which Investment Incentive Certificate has been issued, investment sites can be allocated within the framework of the procedures and principles determined by the Ministry of Environment, Urbanization and Climate Change (General Directorate of National Real Estate).
INSURANCE PREMIUM EMPLOYER SHARE SUPPORT
➢The amount of the employer's share of the insurance premium to be paid for additional employment provided by investment within the scope of the Investment Incentive Certificate, corresponding to the minimum wage, is covered by the Ministry for a certain period of time.
➢Applied for incentive certificates issued within the scope of strategic investments, regional and priority investment incentive practices.
INSURANCE PREMIUM SUPPORT
➢The scope of the Investment Incentive Certificate is the Ministry's coverage for 10 years, corresponding to the minimum wage, of the worker's share of the insurance premium to be paid for additional employment provided by investment.
➢Except for the general incentive applications, it is only stipulated in the incentive certificates issued for the investments to be made in the 6th Region. It can also be applied to strategic investments supported under the Technology Oriented Industry Move Programme.
VAT REFUND
➢Return of VAT collected for building-construction expenditures made within the scope of Strategic Investments with a fixed investment amount of more than 500 million Turkish Liras.
MINIMUM INVESTMENT AMOUNT
➢Minimum fixed investment amount in the General Incentive System; ▪ I. and II. 3 million TL in regions,
▪III., IV., V. and VI. It is 1 million 500 thousand TL in the regions.
➢The minimum fixed investment amount determined for Strategic Investments is 50 million TL.
➢For Regional Incentive Practices, a minimum of 1 million 500 thousand TL has been determined separately for each supported sector and each province.
Regional Incentive Practices
Regional Map 2017
EB: Investments made in the Industrial Zone for the manufacturing industry.
*Within the scope of investment incentive certificates issued for the manufacturing industry (US-97 Code: 15-37), the investment contribution rate for the investment expenditures to be made between 1/1/2017 and 31/12/2022 is 15 points to the investment contribution rate valid in each region. In addition, the tax deduction rate is applied as 100% in all regions and the rate of the investment contribution amount that can be used in the investment period is applied as 100%.
** In case it is requested during the application phase regarding the issuance of an incentive certificate, the ratio of the support to the fixed investment amount is applied by increasing the ratio of the contribution to the investment by half, provided that the tax deduction is not benefited.
*** In order to support women and/or youth employment, the duration of employment support for companies employing women and/or youth has been extended.
- Building-construction expenditures made within the scope of the document in the manufacturing and tourism sector can be benefited from VAT exemption until 31/12/2025.
REGIONAL INCENTIVE PRACTICES
In Regional Incentive Practices; The sectors determined by provinces in the annex of the decision benefit from the following supports if they provide the minimum capacity or amounts.
SUPPORT ELEMENTS
➢VAT Exemption
➢Customs Duty Exemption
➢Tax Discount
➢Insurance Premium Employer Share Support
➢Interest or Dividend Support (in the 3rd, 4th, 5th and 6th Regions) ➢ Investment Place Allocation
➢Insurance Premium Support (in the 6th Region)
TAX REDUCTION Contribution to Investment (%)
For investment expenditures to be made between 1/1/2017 and 31/12/2022 within the scope of investment incentive certificates issued for the manufacturing industry (US-97 Code: 15-37);
* 15 points are added to the investment contribution rate valid in each region.
** The tax reduction rate is applied at 100% in all regions.
