Şimşek: No increase in VAT rates

ISTANBUL

Treasury and Finance Minister Mehmet Şimşek has refuted reports that the Value Added Tax (VAT) rate on food will be increased.

“We have not raised VAT rates! We are taking steps to prevent abuse,” Şimşek wrote on X, quoting a news report on his ministry’s preparation on a regulation regarding services in restaurants and cafes.

According to the report Şimşek referred to, recent inspections have found that some restaurants or cafes were pretending to sell products such as meat, water and fruit juice instead of food and beverage services and were charging VAT at 1 percent instead of 10 percent.

In addition, some grocery stores were found to be pretending to sell food when they were selling cleaning supplies.

In response, the ministry took action and prepared a draft communiqué to amend the General Implementation Communiqué on VAT to prevent abuse and ensure a level playing field.

According to the draft published on the website of the Revenue Administration, businesses such as restaurants, cafes and pastry shops that provide services will charge a 10 percent VAT on the food and beverages they prepare and serve themselves, as well as on the products they outsource and sell there.

All sales made by these businesses through delivery of orders made via phone, online, or pick-up, will also be within the same scope.

On the other hand, sales made by businesses that provide food and beverage services in areas where customers can be served even though they do not have a workplace license for food and beverage services will also be evaluated under this provision.