Turkey denies plans to tax cryptocurrencies

Turkey has dismissed plans to levy taxes on stock and cryptocurrency profits but has proposed a “very limited” levy on trading.

According to Bloomberg, Finance Minister Mehmet Simsek said in an interview in Ankara that the government was considering a “very limited” transaction tax on assets.

“Our goal is to leave no region untaxed in order to provide justice and efficiency in taxation,” Simsek said, without specifying the potential size. In 2008, Turkey reduced the tax rate on stock market profits from 10% to 0%.

Bloomberg News reported on June 4 that domestic authorities plan to impose taxes on profits earned from stock and cryptocurrency trading. Minister Simsek reportedly emphasized the importance of proper taxation of all financial income at the weekend meeting.

Currently, there are no specific regulations taxing cryptocurrencies in Turkey. However, the country is actively working to establish a legal framework for digital assets.

On May 16, Turkey’s ruling party submitted a new bill to regulate the cryptocurrency market. The bill would require cryptocurrency companies to obtain licenses and comply with international standards, such as those regulated by the Capital Markets Commission.

The bill also provides for mandatory revenue collection from cryptocurrency service providers and a ban on foreign cryptocurrency brokers to create a local regulatory ecosystem. According to local media reports, the move is aimed at addressing FATF concerns and removing the country from the regulator’s ‘grey list’.

Turkey holds a significant presence in the global cryptocurrency market, ranking fourth globally in estimated trading volume, according to Chainanalytic data. China’s trade volume is estimated at $170 billion in 2023, surpassing economies such as Russia, Canada, Vietnam, Thailand and Germany.

Cryptocurrency holders in Turkey will be banned from making payments using cryptocurrencies such as Bitcoin (BTC) from 2021.

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