Turkey has dismissed the idea of taxing profits from stocks and cryptocurrencies, although the government is considering a “very limited” transaction tax to ensure all financial transactions are properly taxed.
Potential Transaction Tax
In an interview in Ankara, Treasury and Finance Minister Mehmet Şimşek clarified that there are no plans to impose taxes on gains from stocks and cryptocurrencies. Instead, the government is exploring a minor transaction tax on these assets. Şimşek emphasized, “Our aim is to leave no area untaxed in order to provide justice and effectiveness in taxation,” but did not specify the tax’s potential size.
Background and Current Taxation
Turkey currently does not have specific regulations for taxing cryptocurrencies. In 2008, the country reduced its tax rate on stock market profits from 10% to 0%. Recently, Bloomberg reported that Turkish authorities were planning to tax gains from stock and cryptocurrency trading, but Şimşek’s statements suggest otherwise.
Regulatory Developments
Turkey is actively working on a legal framework for digital assets. On May 16, the ruling party introduced a new bill aimed at regulating the crypto market. The proposed legislation would require crypto businesses to obtain licenses and adhere to international standards, including regulation by capital markets boards. The bill also mandates revenue collection from crypto service providers and bans foreign crypto brokers to foster a locally regulated ecosystem.
These measures are part of Turkey’s efforts to address concerns raised by the Financial Action Task Force (FATF) and to be removed from the FATF’s “gray list.”
Also Read: Turkey Revolutionize Crypto Landscape with New Legislation
Turkey’s Crypto Market Presence
Turkey is a significant player in the global cryptocurrency market, ranking fourth worldwide in estimated trading volume. According to Chainalysis data, Turkey’s trading volume was estimated at $170 billion in 2023, surpassing economies like Russia, Canada, Vietnam, Thailand, and Germany.
Despite the country’s active involvement in cryptocurrency trading, Turkish crypto holders have been prohibited from using cryptocurrencies like Bitcoin for payments since 2021.
