President authorized to set tax on vehicles

ANKARA 

In line with a communique published in the Official Gazette, the president of the country has been granted the authority to set the special consumption tax (SCT) on vehicles.

The new communique made changes to the existing regulations concerning the tax rates and the authorization.

Accordingly, not the cabinet but the president will have the authority to decide on the SCT charged on vehicles.

The new communique stipulates that the president is authorized to increase the upper and lower limits of the SCT by three times or can reduce it to “zero.”

Meanwhile, Kemal Kılıçdaroğlu, the leader of the Republican People’s Party (CHP) has promised to significantly reduce the SCT on car sales, advising people to postpone their plans for buying a new vehicle until the opposition comes to power.

“Postpone buying cars until we come to power. Don’t buy now. When we come to power, we will reduce the special consumption tax. It will be imposed only on luxurious cars,” Kılıçdaroğlu said through a video message late July 25.

“We are paying the ÖTV in addition to the 18 percent value-added tax over the original car price. Plus, customs duty and annual vehicle taxes. Why so many tax?” he asked.

A Turkish citizen is paying nearly twice as much as a German citizen while buying the same car, Kılıçdaroğlu stressed, adding “I am making a very open call now. One of the first things we are going to do [when we come to power] is to cut taxes on cars up to 1.6-liter engines to about a quarter of today’s rate.”

This tax cut will not be valid for luxurious cars, those who can afford the luxurious vehicles will continue to pay higher taxes, the CHP leader stated.