Increase In Special Consumption Tax

The Cabinet increased the Special Consumption Tax rate on automobiles by 3 to 25 points. It also imposed a minimum tax on beer and other alcoholic beverages, whereby the Special Consumption Tax (OTV) on them cannot be less than 750 thousand TL for 1 liter of beer and 1 million TL for one liter of wine.According to the decree of the cabinet, which was promulgated in the Official Gazette and entered into force today, OTV was increased from 27% to 30% on cars having an engine volume of less than 1600 cubic centimeters, from 46% to 52% on cars having an engine volume between 1600 and 2000 cubic centimeters, and from 50% to 75% on cars having an engine volume that is greater than 2000 cubic centimeters. With a new arrangement, OTV on luxurious cars was raised more than that on normal cars. Another Cabinet decree brought about a minimum tax for alcoholic beverages. According to this decree, the minimum OTV amount, taken from these beverages, will be between 750 thousand TL and 20 million TL in accordance with the type of the beverage. This decree does not change the existing tax rates, but puts forward a floor for them.Officials stated that this increases in OTV stemmed from the financial need, caused by the cancellation of the extra motor vehicle taxes by the Constitutional Court.Â