Turkey Considers Limited Transaction Tax on Stocks and Crypto

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As an analyst with a background in finance and experience in following the global financial markets, I find Turkey’s stance on taxing profits from stocks and cryptocurrencies intriguing. The Turkish government’s decision not to impose taxes on profits earned from these assets but instead consider a transaction tax is a prudent move, in my opinion.

Mehmet Simsek, Turkey’s Treasury and Finance Minister, made clear the Turkish government’s position regarding taxation of profits derived from stocks and cryptocurrencies. He stated that there are currently no plans to levy taxes on earnings generated from these assets. Instead, the government is contemplating the implementation of a “modest” transaction tax.

In a Bloomberg interview held in Ankara, Simsek expressed his government’s firm stance against exempting any sector from taxation to ensure “fairness and productivity” in Turkey’s taxation system. Concurrently, the Borsa Istanbul 100 Index experienced a brief recovery on Wednesday, climbing up to a 0.7% increase before settling at a 0.1% rise as of 5:18 p.m. in Istanbul. Previously, the market had dipped due to rumors about potential taxes on stock and cryptocurrency earnings.

Mehmet Gerz, CEO of Ata Portfoy, expressed his concerns about the proposed stock trading tax, explaining that it might result in market inefficiencies and higher commissions and fees for investors. Essentially, he viewed it as a move aimed at capitalizing on heavy trading volumes.

Currently, Turkey lacks defined tax laws for cryptocurrencies. However, as announced on May 16, Turkey’s governing party intends to introduce a new legislation. This bill aims to oversee the cryptocurrency market by mandating a license for any organization involved in crypto-related business and requiring them to adhere to international standards.

As an analyst, I would describe this legislation in the following way: This law mandates collecting revenues from service providers and prohibits foreign crypto brokers, aiming to establish a homegrown, regulated environment. By implementing these measures, Turkey intends to address the concerns of the Financial Action Task Force (FATF) and potentially be removed from their ‘gray list’.

Based on Chainalysis’ findings, the nation is expected to rank fourth globally in terms of cryptocurrency trading volume, with a projected $170 billion in 2023 – surpassing the figures for countries such as Russia, Canada, Vietnam, Thailand, and Germany.

As a crypto investor, I’ve noticed that since the beginning of 2021, it has become impossible for me to use cryptocurrencies such as Bitcoin (BTC) for making payments in Turkey.

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2024-06-06 09:42