Bill Draft Controversy: Agencies Warn of Tax Inequality
A new bill draft targeting foreign accommodation platforms has raised concerns in the sector regarding unfair competition due to the tax gap between them and domestic agencies.
As the new bill draft regulating the activities of digital accommodation platforms in Turkey is expected to reach the Parliament, TÜRSAB and industry representatives have raised warnings of unfair competition and monopolization due to inequalities in tax rates.
Expected Process of the Bill Draft
The bill draft aimed at regulating the activities of international digital accommodation platforms in Turkey is expected to come to the agenda of the Parliament in the coming days. The draft has brought discussions in the tourism sector even before becoming law.
Differences in Tax Burden
According to the evaluations of TÜRSAB Vice President of the Board of Directors Hasan Eker, while domestic agencies in Turkey carry out their activities with a tax burden of approximately 25 percent, a 5 percent tax is envisioned to be applied to foreign online platforms.
Risk of Unfair Competition and Monopolization
It is stated that the tax disparity that will occur could provide a price advantage to foreign platforms, which in the long run could trigger the risk of monopolization by weakening competition in the market and negatively affect the sales of domestic agencies.
Demand for Equal Conditions and Office
Sector representatives emphasize that they are not against online platforms, and that their main expectations are the prevention of unfair competition and that foreign platforms should also open offices in Turkey by being subject to completely equal obligations with domestic agencies.
Other Regulations Introduced by the Draft
According to the new draft, in order for foreign platforms to operate in Turkey, they are required to obtain a permit certificate from the Ministry of Culture and Tourism, maintain a representative, and ensure that the amount they will receive over the sales price does not exceed 17 percent excluding VAT.