Incentives

Cities in Turkey are grouped in 6 regions according to the results of Socio-Economic Development Index research performed by the Ministry of Development. Capital Ankara has been classified in the 1st Region together with the most developed cities such as İstanbul and İzmir. The New Incentive System is comprised of 4 categories. For an investment to be eligible to benefit from support elements in Ankara, the minimum fixed investment amount should be 1 million Turkish Liras. Investments with fixed investment amount 1 million Turkish Liras or above can benefit from VAT exemption and custom duty exemption. In the context of  general, regional, project-based and strategic investments, there exist different types of incentive implementations as given in the following:

General Investment Incentives

• VAT Exemption
• Customs Duty Exemption

Regional Investment Incentives

• VAT Exemption
• Customs Duty Exemption
• Corporate Tax Reduction
• Social Security Premium Support (Employer’s Share)
• Interest Rate Support
• Land Allocation

Strategic Investment Incentives

• VAT Exemption
• Customs Duty Exemption
• Corporate Tax Reduction
• Social Security Premium Support (Employer’s Share)
• Interest Rate Support
• Land Allocation
• VAT Refund

Project Based Investment Incentives

• VAT Exemption
• Customs Duty Exemption
• Corporate tax reduction up to 200% of investment expenditures
• Social security premium support for up to 10 years (employer’s share)
• Interest rate support for up to 10 years
• Land allocation for 49 years Infrastructure support  
• Cash Support  
• Income tax withholding support for 10 years
• Qualified personnel support for up to 5 years
• Energy support for up to 50% of energy expenditures for up to 10 years 10 years
• Capital contribution up to 49% of the investment amount
• Purchasing guarantee
• Facilitation of authorization-permit-license procedures
• VAT refund for building-construction expenditures

There also exist additional incentives for the firms located in OIZ:

• No VAT for land acquisitions
• Exemption from real estate duty for five years starting after the construction of the plant
• Low water, natural gas, and telecommunication costs
• For unification and/or separation of plots, no tax to be paid. Exemption from municipality tax for construction and usage of the plant
• Exemption from the municipality tax on solid waste if the OIZ does not benefit from the municipality service

Similarly, the incentives for the firms located in Technoparks are:

• Revenues derived from software development and R&D activities are exempt from income and corporate taxes until December 31, 2023.
• Sales of application software produced exclusively in TDZs are exempt from VAT until December 31, 2023. Examples include software for systems management, data management, business applications, different business sectors, the Internet, mobile phones and military command control.
• Salaries of R&D and support personnel employed in the zone are exempt from all taxes until December 31, 2023. The number of the support personnel covered by the exemption shall not exceed 10 percent of the number of the R&D personnel.
• Enterprises may make the investment, required for the production of the technological product obtained as a result of the R&D projects conducted in the zone, in the TDZ, if deemed suitable by the operator company and allowed by the Ministry.
• 50 percent of the employer’s share of the social security premium will be paid by the government for 5 years until 31.12.2024.