Turkey lowers withholding tax on lira deposits, raises tax on forex deposits

ISTANBUL

Turkey has lowered the level of withholding tax on lira bank deposits of more than one year to zero from 10 percent, while raising the tax level on foreign currency deposits of up to one year, the Official Gazette said on Aug. 31.

It said the withholding tax on deposits of up to one year was cut to 3 percent from 12 percent and the tax on deposits of up to six months was cut to 5 percent from 15 percent.

The tax on forex deposits of up to one year was raised to 16 percent from 15 percent. The changes will be in effect for three months, it said.

The lira strengthened by some 2.1 percent following the move, trading at 6.51 against the dollar.
The currency has lost close around 40 percent of its value this year amid various economic concerns and a diplomatic dispute with the United States.