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Item by item calculated! A 44% increase in taxes, fines, and fees in 2025.

Item by item calculated! A 44% increase in taxes, fines, and fees in 2025.

07.10.2024 10:30

Within the scope of the OVP, the inflation rate based on the CPI is projected to be at 17.5%, while a hike of around 44% is expected for taxes such as real estate, environmental, sanitation, special communication, and motor vehicles as of the beginning of the year.

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In the Medium-Term Program for 2025-2027, while the inflation rate based on consumer prices for the entire year of 2025 is projected to be at 17.5 percent, various taxes such as Real Estate, Environmental Cleaning, Special Communication, and Motor Vehicle taxes, as well as various fees collected in official transactions, vehicle inspection fees, Income Tax tariff brackets, and traffic fines are expected to increase by around 44 percent at the beginning of the year.



According to a report in Dünya newspaper; The aforementioned fixed taxes, fines, fees, and charges are increased at the beginning of each year by the "revaluation rate" as per the repeated 298th article of the Tax Procedure Law. The increase in the average of the Domestic Producer Price Index (D-PPI) for the last twelve months as of the end of October each year compared to the average of the previous twelve-month period provides the revaluation rate that will be valid at the beginning of the following year. The revaluation rate has varied significantly in recent years according to the course of inflation, and the burden on taxpayers has become extraordinarily heavy in years of high inflation.



The revaluation rate, which remained at 9.11 percent in 2020, rose to 36.2 percent in 2022, and reached its highest level in history at 122.93 percent in 2023, while this rate was applied at 58.46 percent at the beginning of 2024. The possible rate to be applied at the beginning of 2025 is expected to be well above the annual inflation target. This indicates that the burden on taxpayers will also increase to a record level in the new year.



THE NEEDLE SHOWS 44%



The revaluation rate to be applied to various taxes, fines, fees, and charges at the beginning of 2025 will be clarified when the inflation data for October 2024 is announced on November 3. The level of the D-PPI as of the end of September indicates that the revaluation rate that will be valid at the beginning of the year will be around 44 percent. Accordingly, various taxes, fines, fees, and charges will increase significantly above the target inflation, although not as much as in 2024.



Itemized calculation! A 44% increase in taxes, fines, and fees in 2025


In November 2023, the Domestic Producer Price Index value was 2882.04, which increased to 3659.84 in September 2024 with a monthly increase of 1.37%, and the average of the index values for the last eleven months was 3028.74.



If the D-PPI increase is zero in October, the index value will be 3333.73 in the average of the last twelve months, and the annual increase compared to the index value of 2318.94 for the same date last year will be 43.76%. This will provide the revaluation rate to be applied to various taxes, fees, and fines in 2025.



If the D-PPI increases by 1.5% in October, the average index value for the last twelve months will rise to 3338.30, and the increase compared to the previous twelve months will be 43.96%. If the monthly increase is 2%, the average index will be 3339.83, and the change compared to the previous twelve months will be 44.02%; if the monthly increase is 2.5%, the average index will reach 3341.35, and the increase rate will be 44.09%.



THE BURDEN OF 2024 INFLATION WILL CARRY OVER TO 2025



If the President does not use his authority to reduce or increase in the areas he is authorized, the obligations in the relevant items will be increased at this rate at the beginning of 2025. The significant increase in taxes, fines, and fees due to the high revaluation rate, along with the inflation that has significantly decreased in 2024 but still remains at a high level, means that the erosion on especially low and fixed incomes will also carry over to 2025.



ITEMS LINKED TO REVALUATION



According to the revaluation rate to be determined on November 3, the taxes, fines, fees, and tariffs to be increased at the beginning of the year are as follows:





  • Real Estate Tax


  • Environmental Cleaning Tax


  • Motor Vehicle Tax


  • Income Tax Law, some exemption amounts, tax tariff brackets, etc.


  • Inheritance and Transfer Tax, exemptions, tariff bases


  • Stamp Tax.


  • Special Communication Tax


  • Traffic fines


  • Driver's license and passport fees


  • Fines under the Tax Procedure Law


  • Administrative fines under the Misdemeanor Law


  • Vehicle inspection fees


  • Exit tax for abroad




WILL THE PRESIDENT USE HIS AUTHORITY TO CHANGE?



According to the Tax Procedure Law, the President has the authority to reduce the revaluation rate for taxes and fees by up to 50% and to increase it by up to 50%. The President's authority to increase the Motor Vehicle Tax is 50%, and to decrease it is 80%. However, it is seen that this authority is rarely and limitedly used, and generally, the revaluation rate determined according to the increase in the twelve-month average D-PPI at the end of October each year is applied to the relevant taxes, fees, fines, and other obligations at the beginning of the following year. The President does not have such authority for administrative fines in some items, and the announced revaluation rates cannot be changed for these items.



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