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Taxes on consumer goods in Turkey: KDV

KDV is a tax imposed at different rates of expense, per the Value-Added Tax Or KDV Law, although the companies are the ones that pay this tax by the sales profits they achieve, this tax is deducted from the final goods’ consumers. The tax amount is ultimately deducted from the person who purchases the goods. The tax amount in Turkey according to the necessity of the goods consumed by are %1, %8, and %18.

According to various researches online, only twenty-one countries have a higher maximum VAT rate than Turkey. Countries with higher VAT rates include Greece, Chile, and Slovakia with KDVs of %19.

KDV Refund For Visitors to Turkey

Visitors to Turkey may be able to get a refund of the tax paid on any goods bought upon leaving the country. To get a VAT refund, you must present receipts for the goods purchased (and possibly proof of your deportation of the goods) to a Turkey VAT refund station (which are often found in airports, tourist offices, or international travel hubs).

Some localities have a minimum purchase price for which a VAT refund can be claimed, or certain purchase types which cannot be made tax-free. A KVD refund of up to %18 of your total expenses may be refunded for qualifying purchases.

Calculating the KDV Amount

While all personal goods will have their KDV price included on the price tag, you can still calculate for other goods and services. The simplest way to calculate the tax amount is to multiply (the price of the product x 1 + the tax rate). For example, assuming a product price of 1453 liras and the tax rate is %18, The price of the Product after the tax is 1453x(1+0.18)= 1453x1.18= 1714.54 liras.

Tax Amount Between Products

In Turkey, there are three different amount of tax imposed on products; %1, %8 and %18, which are seperated by the products mentioned below.

Products with %1 Deduction

Taxed on basic traded and consumable materials like grain and such, as well as residential units that do not exceed an area of 150 square meters.

Products with %8 Deduction

Also, imposed on basic consumer materials which do not fall within the luxury goods, like meat, milk, eggs, fruits, honey, and some animals.

Products with %18 Deduction

Imposed on products that are not considered essential consumer goods with certain exceptions, such as furniture, electrical appliances, some animals, some spices, and other products and services.

KDV For Businesses and Sellers in Turkey

Businesses in Turkey are required to collect a sales tax of 18% on behalf of the government, which they must submit to the applicable Turkey revenue department in a periodical VAT tax return. The Turkish VAT is collected on all sales - even if they are raw materials.

The VAT is a sales tax that applies to the purchase of most goods and services, and must be collected and submitted by the merchant to the Turkey governmental revenue department. KDV reports are the responsibility of the merchant, and failure to collect and submit the right tax number may result in severe penalties.

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