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Withholding Tax to be Applied to Lira Deposit, Bond Gains

TURKEY
  • A withholding tax will be imposed on lira deposits, depending on their maturities, Bloomberg report citing a presidential decree published in the official gazette. The withholding tax on lira deposits up to six months will be 7.5%; 5% for deposits up to 1 year and 2.5% for deposits over 1 year. Deposits converted to lira from FX-protected deposits will be exempt from the tax.
  • Furthermore, proceeds from bonds will also be taxed between 2.5% to 7.5%, depending on how long they have been held. The tax rates will be valid from May 1 until July 31.
  • Local news flow has otherwise been limited today given Turkey celebrates Labour Day today. Looking ahead, CPI data is the key release of the week on Friday (Est: +70.00% Y/Y; Prior: +68.50%).

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