Taxation in Turkey: A child who goes to the grocery store can return with a fine of 5,000 Turkish Liras

The increase in penalties in tax laws has scared both consumers and businesses. A child going to a store to buy bread or gum could return home with a fine of 5,000 Turkish Liras.

Due to the penalty increases in the tax package expected to be discussed in the Turkish Grand National Assembly this week, a warning was issued that both businesses and consumers could face serious fines. According to the proposed law, a child going to the store to buy bread or gum but not taking the receipt could be fined 5,000 Turkish Liras.

Targeting to prevent tax evasion with dissuasive penalties, the Ministry of Treasury and Finance aims to make increases in penalty amounts exceeding 43 times in tax penalties. Representatives of the Union of Chambers of Certified Public Accountants and Sworn-in Certified Public Accountants of Turkey (TÜRMOB) stated that penalties have been determined disproportionately, mentioning that if the penalties are applied, businesses that do not provide a receipt after shopping could be fined 10,000 TL for the first violation and up to 65,000 TL for subsequent violations.

Also, a child going to the store to buy bread or gum but not taking the receipt could be fined 5,000 Turkish Liras.

‘EXCESSIVELY HIGH’

Consumers who do not take their receipts after shopping could face a fine of 5,000 Turkish Liras regardless of the shopping amount. In current legislation, this penalty is currently applied at 680 TL. Apart from the authorized personnel of the Ministry of Finance, individuals designated for this purpose may also impose this penalty. TÜRMOB officials who argue that the penalty amounts are disproportionate and excessively high provided the following example of disproportion between the penalty and the receipt amount:

Your child who goes to the grocery store can return with a fine of 5,000 Turkish Liras

“You send your child to the store to buy bread. The child buys the bread and as he/she is leaving the store, the officials ask for the receipt. The child says he has not taken it. The penalty to be applied is a full 5,000 Turkish Liras. So, your child who goes to the store for bread might return home with a fine receipt of 5,000 liras.”

Employer blaming accountants for the penalty

In the evaluation report prepared by TÜRMOB regarding the tax package, it was reported that the increasing penalties would affect accountants and financial advisors rather than taxpayers. The report stated, “Although the majority of irregularity and specific irregularity penalties are imposed on the offending taxpayers, unfortunately, in practice, most of these penalties are imposed on professional members. Increasing the penalties to this extent leads the professional members to become unable to perform their jobs both psychologically and economically.”