The statutory deductions applicable in a standard Turkish payroll are social security premium, income tax, and stamp tax. Also, the salaries generated from liaison offices in Türkiye are exempt from income tax per Article 34/14 of Income Tax Law, and these are only subject to social security.

Also, the income tax exemption as much as the income tax deduction amount calculated over the minimum wage for all wages introduced in 2022 will continue in 2023 as well.

Social Security Premium

Social Security Premium is calculated over wages monthly and paid jointly by the employee and the employer. The contribution rates are as follows:

In accordance with the Industrial Registry Law No. 6948 (In Turkish) of April 17, 1957, which is included in the Article 8 of the Law No. 7201 (In Turkish) published in the Official Gazette No. 30988 dated 24.12.2019 and the provisional article 39 of the Law No. 3065 (In Turkish); the period of VAT exemption applied in the deliveries of new machinery and equipment was extended until December 31, 2022.

With the Presidential Decree published in the Official Gazette No. 32050 dated 21.12.2022, relevant period is extended until December 31, 2024.

Regulation was postponed to January 1, 2023 according to the provision of subparagraph (b) of the first paragraph of Article 52 of the Law No. 7194, which was amended by Article 61 of the Law No. 7338 on the Amendment of Tax Procedures and Certain Laws, dated October 14, 2021.

Procedures and principles are determined in the "Accommodation Tax Application General Communiqué" which was published in the Official Gazette No. 32043, dated December 14, 2022.

• Overnight services provided by the facilities including hotels, motels, holiday villages, pensions, apart-hotels, guesthouses, camping, chalets, highland houses are subject to accommodation tax.
• All other services offered within the accommodation facility by being sold together are also subject to accommodation tax.
• Circumcision, wedding, cocktail, meeting, congress, symposium and similar organization services provided in accommodation facilities are not within the scope of the tax.
• Services offered to students in dormitories, hostels and camps, as well as the services provided to the diplomatic representations, consulates of foreign states in Turkey and their members with diplomatic rights, and to international organizations and their members that are tax exempt in accordance with international agreements are exempt from tax, if the services are offered reciprocally.
• Accommodation tax liability is established prior to the initiation of business, after the accommodation facility is fully or partially ready for operation.

a. Minimum Wage

In the press release dated December 22, 2022, the Ministry of Labor, along with the Minimum Wage Determination Committee has announced the minimum wage to be effective for the year of 2023, as shown in the table below.