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Turkey Launches Ambitious Tax Incentive Package to Become a "Global Attraction Hub"
Istanbul, Turkey – Turkish President Recep Tayyip Erdoğan announced on Friday, April 24, 2026, a comprehensive package of tax incentives aimed at establishing Turkey as a global center for investment, trade, and attracting international talent. The announcement was made during a ceremony held in Istanbul, where Erdoğan emphasized that these measures will be submitted to parliament as part of a broader vision to transform the Turkish economy amid global economic uncertainty.
Unprecedented Tax Cuts to Support Exports and Production
The new package includes significant reductions in corporate tax rates, reflecting the government's commitment to supporting vital sectors. The corporate tax rate for exporting manufacturers will be reduced from 25% to 9%, while other exporters will benefit from a reduced rate of 14%. This step aims to enhance the competitiveness of Turkish products in global markets and encourage foreign direct investment in the manufacturing sector.
The package also includes near-complete tax exemptions on transit trade income, where companies operating in the Istanbul Financial Center (IFC) will receive a 100% tax exemption on their transit trade income, while companies outside specified financial sectors will receive a 95% exemption. This measure aims to leverage Turkey's strategic geographic location along the middle corridor, transforming it into a regional and international logistics and trade hub.
Additionally, the tax exemption on service exports has been expanded to include a 100% exemption for high value-added sectors such as software, electronic games, medical tourism, education, engineering, and design. This approach seeks to strengthen Turkey's service sector, which already enjoys an export surplus exceeding $60 billion.
20-Year Tax Exemption to Attract Talent and Capital
One of the most prominent features of the new package is a provision targeting wealthy individuals and professionals residing abroad. Individuals who have not been tax residents in Turkey for the past three years and choose to relocate there will benefit from a 20-year tax exemption on their income and gains from foreign sources. This measure, known as the "Non-Dom" system, aims to attract talent and foreign capital and is more attractive than similar programs in other countries such as Italy and Greece, which offer 15-year exemptions.
To enhance the appeal of this system, inheritance tax for this group has been reduced from 10% to just 1%. Companies relocating their regional headquarters to the Istanbul Financial Center will benefit from a 100% corporate tax exemption, while those moving headquarters to other locations in Turkey will receive a 95% exemption.
Istanbul Financial Center and "Terminal Istanbul": Strategic Growth Hubs
The Istanbul Financial Center (IFC), officially opened in 2023, is a key component of this strategy. The center houses Turkey's leading financial institutions, such as the Central Bank, Istanbul Stock Exchange, and regulatory bodies, and is promoted as a regional competitor to global financial centers.
In an innovative move, the government plans to transform the old Atatürk Airport into a new global technology hub named "Terminal Istanbul," aimed at supporting innovation and entrepreneurship. The government will also facilitate administrative procedures for investors, including company formation, work and residence permits, insurance, and land allocation, all to be conducted fully electronically.
Global Context and Strategic Objectives
This package comes amid a global context marked by economic disruptions, regional conflicts, and changing international trade patterns. President Erdoğan noted that "all economic circles are trying to find their way through dense fog," emphasizing that Turkey seeks to become "a new pole in a multipolar global system".
These reforms aim to boost Turkey's GDP, which reached $1.6 trillion in 2025, surpassing the average of emerging markets. The strategy also focuses on digital transformation, the green economy, and increasing the added value of Turkish industry from low to medium and high technology, reflecting a comprehensive vision for sustainable economic development.
Frequently asked questions
What is the purpose of the new tax incentives in Turkey?
They aim to transform Turkey into a global hub for attracting investment, trade, and international talent, and to enhance the competitiveness of the economy.
What are the most significant corporate tax reductions in Turkey in 2026?
The corporate tax rate for exporting manufacturers has been reduced from 25% to 9%, and for other exporters to 14%.
What is the tax exemption system for individuals in Turkey in 2026?
Individuals who have not been tax residents for the past three years are eligible for a full exemption from taxes on their foreign income for 20 years.
What is the purpose of the Non-Dom system in Turkey?
It aims to attract foreign investors, high-net-worth individuals, and skilled professionals to the country.
Are there additional benefits for foreign investors?
Yes, the inheritance tax for this category has been reduced from 10% to 1%, in addition to exemptions for companies that relocate their headquarters to Turkey.
