Turkey is eyeing finalization of taxing cryptocurrencies by next year

[cheezcarls]

Source: https://cryptonews.com/news/turkey-projects-finalization-of-cryptocurrency-taxes-by-next-year.htm

To further strengthening the regulation within the country, the Turkish government is now projecting to finalize crypto taxes sometime next year.

However, they did not mention in the article yet about the percentage of tax that will be imposed on cryptocurrencies converting to fiat in any regulated bank, digital bank, remittance or so. India's crypto taxation currently stands at 30% which is somewhat "too much" in the eyes of many.

In my opinion, crypto taxation would be a great challenge for the government in tracking our transactions especially when it involves the cryptocurrencies that we have in our non-custodial wallets. Usually capital gains and/or realized income would be the main basis of computing our taxes when converting cryptocurrencies to fiat money.

I believe regulation is far more better than just outlawing or outright banning them them but a double-edged sword for decentralization, data ownership and user privacy no matter which country you are in as they are aiming to co-exist with cryptocurrencies leading to massive adoption.

[knowngunman]

Is this supposed to be a positive development or otherwise? Because this seems like a plan or trap that Turkish government is trying to discourage crypto speculation and encourage more traditional investment because the proposed tax rate is between 15% and 30%, which is quite high compared to traditional financial transactions according to what I read here . Although it has not been approved but I don't expect anything less. The Turkish government has been considering imposing a tax on cryptocurrency transactions since at least from 2021 And from what you posted, it seems that they're getting closer to finalizing this tax. If it's approved it would make Turkey one of the first countries in the world to impose a tax on crypto transactions. However, we are watching to see how this tax would be implemented and enforced.

[zasad@]

The Turkish economy has a very large share of shadow exports. Although sanctions have been introduced against Russia, a lot of goods still come from Turkey and payment for these goods also includes cryptocurrencies. So any tightening of legislation could harm the Turkish economy, which already has many problems. And in Turkey, just like in Russia, there are many laws that are not respected.

[Poker Player]

Turkey is going in the wrong direction. With one of the highest inflation rates in the world, they first banned payments with cryptocurrencies, and, as it usually happens, as people skipped the ban they have realized that it is better to regulate them and try to tax them. The problem is that if you put high taxes you incentivize people not to declare. If instead of 30% they put a 5% tax almost everyone would declare because for how cheap it is it is not worth getting into a potential problem with the tax authorities, but with how disastrous Turkey's monetary policy is going I am not surprised.

[avikz]

Well slowly all other countries will start imposing tax on Bitcoin. But it will be very interesting to see how they are going to track it. Surely they cannot impose taxes on Bitcoin transactions, rather they will try to track any conversion into Fiat through the banking channel. That's how other countries are texting cryptocurrency.

But one good thing is going to happen, probably after a structured framework a lot of merchants might become interested in accepting Bitcoin payment. But we are yet to see this.

[joniboini]

which is quite high compared to traditional financial transactions according to what I read here .

I can't read the full content, but is this draft the same thing as the document released on the latest news?[1] I can't really read it since it is in Turkish, but a quick search doesn't show the 15% number (unless my browser fucks up and failed to search the whole document). I might be wrong, but it seems like they are still open and researching further on the details.

[1] https://www.resmigazete.gov.tr/eskiler/2023/10/20231025M1-1.pdf

[safar1980]

Turkey to toughen law on crypto assets - minister
ANKARA, Nov 1 (Reuters) - Turkey is preparing new legislation covering crypto-assets to persuade an international crime watchdog to remove it from a "grey list" of countries that have taken insufficient action to prevent money laundering and terrorist financing.

The Financial Action Task Force (FATF) downgraded Turkey to a so-called grey list in 2021. Addressing a parliamentary commission late on Tuesday, Finance Minister Mehmet Simsek said a FATF report found Turkey fully compliant with all but one of the watchdog's 40 standards.

[AHOYBRAUSE]

Turkey to toughen law on crypto assets - minister
ANKARA, Nov 1 (Reuters) - Turkey is preparing new legislation covering crypto-assets to persuade an international crime watchdog to remove it from a "grey list" of countries that have taken insufficient action to prevent money laundering and terrorist financing.

The Financial Action Task Force (FATF) downgraded Turkey to a so-called grey list in 2021. Addressing a parliamentary commission late on Tuesday, Finance Minister Mehmet Simsek said a FATF report found Turkey fully compliant with all but one of the watchdog's 40 standards.

A lot of things are going wrong in Turkey at the moment.
I think new legislations in the financial sector are their smallest problem.

As long as this government,and dictatorship is in place, and they keep supporting terrorist groups like Hamas and trying to call all Muslims to "fight all the Jews", it doesn't matter what they are doing regarding crypto. It will have 0 influence on bitcoin in general I think.

Sooner or later this will end really bad. 

[rahim066]

Crypto taxation is a challenge for governments, but regulation is better than a ban. Governments should focus on regulating intermediaries and taxing capital gains and realized income at a reasonable rate, while allowing people to hold and use cryptocurrencies without disclosing their identities. This would create a fair and balanced regulatory environment that fosters innovation and adoption.

[zasad@]

Turkey to toughen law on crypto assets - minister
ANKARA, Nov 1 (Reuters) - Turkey is preparing new legislation covering crypto-assets to persuade an international crime watchdog to remove it from a "grey list" of countries that have taken insufficient action to prevent money laundering and terrorist financing.

The Financial Action Task Force (FATF) downgraded Turkey to a so-called grey list in 2021. Addressing a parliamentary commission late on Tuesday, Finance Minister Mehmet Simsek said a FATF report found Turkey fully compliant with all but one of the watchdog's 40 standards.

A lot of things are going wrong in Turkey at the moment.
I think new legislations in the financial sector are their smallest problem.

As long as this government,and dictatorship is in place, and they keep supporting terrorist groups like Hamas and trying to call all Muslims to "fight all the Jews", it doesn't matter what they are doing regarding crypto. It will have 0 influence on bitcoin in general I think.

Sooner or later this will end really bad. 

It is better to avoid politics, because there will be a lot of counter-news about the bombing of hospitals.
In such a situation, all countries will be forced to raise taxes and look for additional sources of budget replenishment. And whose economies collapse faster, those countries will be among the losers. We live in an era of change.

[stompix]

Don't hold your breath, it's Turkey and Erdogan we talk about:

Turkey’s President Recep Tayyip Erdoğan has stated that Turkey’s cryptocurrency law “is ready” and will be submitted to parliament “without delay.” Turkish President Recep Tayyip Erdoğan said at a meeting with journalists “The law is ready, we will send it to the parliament soon without delay.”

27 December 2021

Turned out to be a nothingburger one and a half year later, this will be at most slightly different.

In my opinion, crypto taxation would be a great challenge for the government in tracking our transactions especially when it involves the cryptocurrencies that we have in our non-custodial wallets. Usually capital gains and/or realized income would be the main basis of computing our taxes when converting cryptocurrencies to fiat money.

That's what they are aiming also, they don't give a damn on the coins you hold in your wallet they are targeting specifically exchanges and capital gains, and for a trader you simply have no way out of this, let's not even mention DEX, it's not there were the real money is made, it's all in CEX and they know they can grab that data with a single click.

Turkey is going in the wrong direction. With one of the highest inflation rates in the world, they first banned payments with cryptocurrencies, and, as it usually happens, as people skipped the ban they have realized that it is better to regulate them and try to tax them. The problem is that if you put high taxes you incentivize people not to declare. If instead of 30% they put a 5% tax almost everyone would declare because for how cheap it is it is not worth getting into a potential problem with the tax authorities, but with how disastrous Turkey's monetary policy is going I am not surprised.

There is only one flaw in your reasoning, you assume that if you tax something by just 5% you will have a flow of grateful citizens who will be on January 1st on the stairs of the IRS to pay up. I don't think there is another region in the world that with the same income and education has the same hate for paying tax and the same affinity for tax evasion as southern Europe and that part of the middle east, if it's one thing Greece and Turkey have in commons is their hate for paying a single dime in tax, and you can see what that has lead to in both cases.

[Yamane_Keto]

High taxes are an indirect encouragement for you to HODLINGgg, or at least to think several times before selling, and may lead some to evade paying taxes by incorrectly reporting profits, but it is a strategy that has proven to fail in reducing dealing with cryptocurrencies, especially since some may choose to continue trading because of free money when trading bitcoin.

[zasad@]

Türkiye is not Europe and America, where tax laws are respected. There are a lot of Russians in Turkey and all private exchanges work the same way as shadow exchangers in Moscow. No taxes and no reports. If you come to a tourist city like Antalya, you can easily buy or sell your cryptocurrencies and even be able to pay for the rent of an apartment.

[zasad@]

https://www.turkiyetoday.com/business/finance/up-to-22-years-in-prison-for-unauthorized-crypto-providers-in-turkiye-24385/
Up to 22 years in prison for unauthorized crypto providers in Türkiye
"The Turkish Parliament (TBMM) has passed a bill introducing new regulations on crypto assets. Individuals and legal entities operating as crypto asset service providers without authorization will face imprisonment for 3 to 5 years.

The “Bill on Amendments to the Capital Markets Law” has been approved by the TBMM General Assembly. According to the bill, crypto asset service providers must obtain permission from the Capital Markets Board (SPK) before establishment and operation. Compliance with the criteria set by TUBITAK is required for SPK authorization."

[YOSHIE]

To further strengthening the regulation within the country, the Turkish government is now projecting to finalize crypto taxes sometime next year.

If the laws that will be implemented by the Turkish government are as planned as below.

Turkey proposes aligning crypto legislation with international standards. The draft law aims to govern crypto asset service providers, crypto asset platform operations, crypto asset storage, and crypto asset buying, selling and transfer transactions.

I think it makes sense and is legal, considering the increase in crypto users in Turkey, very high, this could add to the government's annual asset income in crypto taxation, that's something that advances regulations with comprehensive thinking about the crypto sector.

However, there are points that in my opinion are not possible for taxation in Turkey, as is said about tax for transactions, this will have a few obstacles to regulate legally, What's more, as reported 0.03% in one transaction, it seems this is difficult to do, unless government taxation focuses on crypto exchange services operating there only, maybe that makes sense, as is done by other countries.

[mindrust]

The Turkish government taxed crypto currencies so they could get removed from grey list, and 2 days ago we left the list.

https://www.bbc.com/turkce/articles/c0x6x01w911o

1 Kasım 2023
Hazine ve Maliye Bakanı Mehmet Şimşek, Türkiye'nin gri listeden çıkması için sadece kripto varlıklara ilişkin bir yasal düzenlemenin kaldığını, onu da kısa süre içinde Meclis'e sunacaklarını belirtti.

google translate:

November 1, 2023
Minister of Treasury and Finance Mehmet Şimşek stated that in order for Turkey to be removed from the gray list, not only crypto assets are stored in a legal regulation, but also that they will present this to the Parliament in a short time.

https://www.bbc.com/turkce/articles/cz9dp87d8pgo

28 Haziran 2024
Mali suçlarla mücadelede ülkelerin performanslarını değerlendiren Mali Eylem Görev Gücü (FATF), Türkiye'nin kara para aklama ve terörizmin finansmanı ile mücadelede geride kaldığı için 2021 yılında alındığı ''gri liste''den çıkarıldığını duyurdu.

Google translate:

June 28, 2024
Financial Action Task Force (FATF), which evaluates the performance of countries in the fight against financial crimes, announced that Turkey was removed from the "grey list", which it was included in in 2021, because it fell behind in the fight against money laundering and the financing of terrorism.

The gov doesn't really care about taxing crypto imo. They did it because many people were using crypto to wash their dirty money in Türkiye and the Europeans didn't like that.
It looks like the crooks finished the job successfully and now leaving grey list is more beneficial to the country.
The date of the first news I gave link to is Nov/23. It took 8 months to come up with a simple regulation. Now you know the reason.

[bbc.reporter]

Is this supposed to be a positive development or otherwise? Because this seems like a plan or trap that Turkish government is trying to discourage crypto speculation and encourage more traditional investment because the proposed tax rate is between 15% and 30%, which is quite high compared to traditional financial transactions according to what I read here . Although it has not been approved but I don't expect anything less. The Turkish government has been considering imposing a tax on cryptocurrency transactions since at least from 2021 And from what you posted, it seems that they're getting closer to finalizing this tax. If it's approved it would make Turkey one of the first countries in the world to impose a tax on crypto transactions. However, we are watching to see how this tax would be implemented and enforced.

Would it be taxable if someone did not sell any cryptocoin and only continued holding it? If I bought bitcoin after the implementation of this rule, do i need to pay taxes for unrealized profits? This would he headshaking if they do this. However, of you are only forced to pay taxes after selling your cryptocoin to fiat, I reckon that this would be very good for a hodling coin like bitcoin. Turkish people should be encouraged to become bitcoin maximalists heheheheh.

[avikz]

Is this supposed to be a positive development or otherwise? Because this seems like a plan or trap that Turkish government is trying to discourage crypto speculation and encourage more traditional investment because the proposed tax rate is between 15% and 30%, which is quite high compared to traditional financial transactions according to what I read here . Although it has not been approved but I don't expect anything less. The Turkish government has been considering imposing a tax on cryptocurrency transactions since at least from 2021 And from what you posted, it seems that they're getting closer to finalizing this tax. If it's approved it would make Turkey one of the first countries in the world to impose a tax on crypto transactions. However, we are watching to see how this tax would be implemented and enforced.

Would it be taxable if someone did not sell any cryptocoin and only continued holding it? If I bought bitcoin after the implementation of this rule, do i need to pay taxes for unrealized profits? This would he headshaking if they do this. However, of you are only forced to pay taxes after selling your cryptocoin to fiat, I reckon that this would be very good for a hodling coin like bitcoin. Turkish people should be encouraged to become bitcoin maximalists heheheheh.

Usually no countries impose tax on unrealised profit. It works similar to stocks. If you hold a stock whose value goes up making you wealthy on paper, the government cannot impose tax on that. They can only impose tax only when you sell it. Crypto taxation will work similarly.

Also there are more practical problems in crypto taxation. It will be interesting to see how Turkish government plans to handle it.

[zasad@]

The situation with laws in Turkey is somewhat similar to the situation with laws in Russia. In some situations, the laws are very strict, and in other situations, they are formal. If, for example, I need to transfer money from Russia to Turkey, then I will give cryptocurrency and the person in Turkey will receive dollars, euros or local currency without any taxes in cash.