Türkiye Unveils Tax Incentives to Reinforce Transit Trade Hub Strategy

Treasury and Finance Minister Mehmet Şimşek stated that the new tax and investment regulations announced under the program titled “Türkiye Century: A Strong Hub for Investment” constitute one of the core pillars of Türkiye’s long-term economic positioning strategy. The program aims to transform the country into a regional center for finance, trade, and logistics.

Minister Şimşek noted that the reform package covers industrial transformation, green and digital transformation, infrastructure investments—particularly railways—as well as public finance and governance reforms. The first announced package focuses on increasing exports, promoting transit trade, and positioning the Istanbul Finance Center (IFC) as a regional hub.

In this context, the corporate tax exemption for transit trade has emerged as a significant step. A 100% corporate tax exemption will apply to transit trade conducted by companies based in the IFC, while a 95% exemption will be granted to companies operating outside the center. With this regulation, Türkiye aims to align itself with global trade hubs such as Singapore, Hong Kong, and the Netherlands.

Transit Trade and Logistics Corridors

Türkiye’s strong geographical position and its location along strategic trade routes such as the Middle Corridor are cited as key foundations of its transit trade policies. Increasing the transit trade tax exemption from 50% to 100% is intended to enhance Türkiye’s competitiveness in regional distribution, transshipment, and logistics operations. This approach also creates a critical foundation for investments in multimodal transportation that integrate air cargo, maritime transport, and road logistics.

Another important pillar of the program is corporate tax reductions aimed at exports. While the standard corporate tax rate is maintained at 25%, the rate is reduced to 14% for exporting companies and to 9% for producer-exporters.

This regulation provides a significant cost advantage, particularly for manufacturing and exporting firms that handle high-volume, time-sensitive air cargo shipments, and aims to increase direct foreign investment in the manufacturing sector.

In addition, increasing the tax exemption on service exports to 100% covers sectors such as software, engineering, architecture, design, health tourism, and digital services. It is noted that Türkiye currently runs a surplus of over USD 60 billion in service exports, and that growth in this area offers a more resilient structure against rising protectionism in global trade. The expansion of service exports further increases the importance of logistics infrastructure related to international workforce mobility, rapid transportation, and air connectivity.

Istanbul Finance Center and Investor-Friendly Regulations

According to statements made during the program, as part of the regulations aimed at making the Istanbul Finance Center a regional base, companies that relocate their regional headquarters to the IFC will be granted a corporate tax exemption for 20 years. In addition, an income tax exemption will apply up to four times the minimum wage.

To accelerate investment processes, the Presidency’s Investment and Finance Office will be transformed into a one-stop shop model for investors. Company incorporation, work permits, customs, tax, and social security procedures will all be handled through a single point.

Meanwhile, Şimşek stated that the impact of regional geopolitical risks on the Turkish economy remains at a manageable level. It was reported that oil prices in 2026 futures contracts are averaging around USD 83 per barrel, and that various scenarios are being closely monitored. Within this framework, potential effects on energy costs, transportation prices, and freight rates are among the key issues that need to be closely followed by the logistics and transportation sector.

Source: AA