May 24, 2020 / 7:23 AM / 3 months ago

Turkey hikes tax on FX transactions to 1% from 0.2% -Official Gazette

ISTANBUL, May 24 (Reuters) - Turkey has hiked a tax on the buying of foreign currency to 1% from 0.2% in a move meant to curb fallout for the lira from the coronavirus pandemic, the country’s Official Gazette said.

In the Gazette announcement dated March 23 and effective immediately, the higher Bank Insurance and Transaction Tax (BSMV) would be applied to FX and gold purchases.

A tax of 0.1% was first applied in May of last year and it was later raised to 0.2% as authorities sought to discourage a so-called dollarization trend of Turks buying dollars and other hard currencies.

The BSMV hike is the latest of several tax changes and regulations Ankara has adopted to stabilize the Turkish lira, which has fallen 13% so far this year and touched an all-time low against the dollar earlier this month. (Reporting by Irem Koca and Jonathan Spicer; Editing by Toby Chopra)

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