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Turkey Issues Draft Guidance On Digital Services Tax

by Lorys Charalambous, Tax-News.com, Cyprus

20 February 2020


The Turkish tax authority has published a draft communique on the application of the digital sales tax (DST), which is set to come into effect on March 1, 2020.

Included in Law No. 7194, enacted by the Turkish parliament on December 5, 2019, the DST applies at a rate of 7.5 percent to revenues from the supply of certain digital services in Turkey. Taxpayers falling into the scope of the tax include those with global revenues of at least EUR750m (USD824m) and Turkish revenues of at least TRY20m (USD3.3m) from taxable services.

According to the communique, digital services falling within the scope of the DST are any kind of advertisement services offered in the digital environment. This includes ad control and services such as performance measurement, user data transmission and management as well as technical services related to the presentation of the advertisement.

Furthermore, taxable services include any audio, visual or digital content (computer programs, applications, music, video, games, in-game apps etc), and content to be listened to, watched, or played digitally.

Additionally, revenues from digital platforms where users can interact with each other are included in the tax. This includes business services, such as the selling of goods and services between users, as well as services provided to facilitate the sale.

The draft communique also contains information on documentation and notification requirements, and tax declaration and payment methods.

TAGS: environment | tax | business | sales tax | commerce | tax authority | internet | e-commerce | transfer pricing | Turkey | services | Tax | BEPS

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