AMENDMENTS TO THE VALUE ADDED TAX LAW WITH THE OMNIBUS BILL DRAFT PRESENTED TO TGNA
An omnibus bill draft consisting of 75 articles is presented to Turkish Grand National Assembly on 02.02.2018. While its main focus is to enhance investment, production and employment; it also brings some important regulations relating to tax liability of research and development activities.
Pursuant to the Article 31 of the draft, the Provisional Article 39 is added to Value Added Tax Law numbered 3065.By this article, the VAT taxpayers meeting the requirements stated in Industrial Registry Law numbered 6948 and dated 17.04.1957, will be exempted from VAT for their machinery and equipment purchases until 31.12.2019. Additionally, the machinery and equipments purchases,in technology development areas which fall into the scope of Law on Technology Development Areas numbered 4691, in R&D design centres which fall into the scope of Law on Promoting Research and Development Activities numbered 5746, in the research laboratories which fall into the scope of Law on Promoting Research Infrastructures numbered 6550, are exempted from VAT, until 31.12.2019
Within three years following the delivery date, in case of disposal or misuse of above mentioned machines and equipments purchased under the provisional Article 39, the reduced tax amount shall be collected with its interest of late payment, by implementing loss of tax punishment.
The Council of Ministers is entitled to determine the machines and equipments subject to the provisional Article 39; and the Ministry of Finance is authorized to determine the rules and procedures regarding its implementation.