“Tax Reduction on Leasing Accelerates Investments” Bekir Öz said that in order to accelerate the investments in the digital printing industry, it is necessary to reduce the leasing VAT which is 18% and to allow loans in foreign currency.
The new regulation, which will take effect on May 2, will limit the borrowing with foreign currency. According to this regulation, those who do not have a foreign currency income will not be able to borrow in foreign currency either domestically or from abroad from this date. In addition, those who have foreign exchange debt of less than 15 million dollars, will not be able to borrow in foreign currency. This new regulation is expected to affect up to 25 thousand small and medium sized enterprises (SMEs).
The new regulation excludes machine and equipment investments where leasing VAT is 1%. However, digital printers with 18% leasing VAT will be affected by this regulation and investors will not be able to borrow in foreign currency. Lidya Group Chairman Bekir Öz expressed the importance of investing in millions of dollars in machinery with foreign currency, as well as with Turkish Lira. Öz said;
Tax Reduction and Leasing VAT
“The regulation that will go into effect on May 2 is limiting the foreign currency borrowing. Entrepreneurs should be able to make a decision whether to borrow in TL or in foreign currencies; when buying a digital printer worth a few million dollars. However, due to the 18% Leasing VAT; the price will cause a loss of investment appetite; for those who want to increase their production capacities by adopting new technologies. There is an unfair situation for the industry here. In summary, if tractors, graders or sewing machines are included in the investment scope; the leasing VAT of industrial printers and their derivative products that contribute to the economy in the same direction should be 1% as well”.
Bekir Öz also added that borrowing in TL is much healthier in order to offset the risk of foreign exchange; while pointing out to the recent fluctuations in the Dollar and the Euro.