Turkey's parliament withdrew cryptocurrency taxation provisions from a comprehensive legislative package following last-minute negotiations between government and opposition lawmakers.
The removed articles would have imposed a 0.03% transaction tax on crypto trades through regulated service providers and withheld 10% on capital gains quarterly.
Deputy Speaker Celal Adan presided over the session where the agreement to remove crypto tax measures was reached before formal debate on the omnibus bill, which also covers defense spending and broader economic regulations.
Evolution From Aggressive to Removed
The original proposal introduced March 2 included a 10% withholding tax on crypto earnings from platforms regulated by Turkey's Capital Markets Board, collected quarterly regardless of whether users sold positions.
The bill also proposed a 0.03% transaction tax on all crypto sales and transfers through service providers.
Parliament's Planning and Budget Committee approved a revised version March 4-5 that eliminated the 10% gains tax and exempted crypto transactions from value-added tax. Only the 0.03% transaction levy remained in the committee-approved text.
Even that scaled-back provision was removed from the final omnibus bill after opposition parties and industry stakeholders raised concerns about capital flight to offshore platforms.
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Capital Flight Concerns, Reintroduction Possible
Turkish analyst Ussal Sahbaz noted that withholding taxes on crypto earnings "would likely push users toward offshore platforms where taxation is declaration-based." Similar tax structures in India and South Korea have created unintended capital outflows, according to industry observers.
Government officials indicated the crypto tax measures may return as separate legislation. Turkey has approximately 24.8 million cryptocurrency users but maintains an April 2021 ban on using crypto assets for payments, which the central bank shows no indication of lifting.
The omnibus bill retains other fiscal measures, including a 20% special consumption tax on diamonds and precious stones.
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