Presidential Decree No. 7846, published in Official Gazette No. 32379 of 24 November 2023, removed the right to deduct VAT calculated under import surveillance, safeguard measures and anti-dumping duties.
The right to deduct VAT relating to import surveillance and safeguard measures has been removed.
Presidential Decree No. 7846, published in Official Gazette No. 32379 of 24 November 2023, removed the right to deduct VAT calculated under regimes such as import surveillance, safeguard measures and anti-dumping duties.
Under the Decree, the right of deduction has been removed for:
- VAT paid in respect of amounts declared but not substantiated in customs declarations for goods subject to surveillance under the relevant legislation on import surveillance, and in respect of all taxes, duties, charges and shares arising from those amounts and included in the VAT base,
- VAT paid in respect of customs duties and/or additional financial obligations applied as safeguard measures under the relevant legislation on import safeguard measures, and in respect of all taxes, duties, charges and shares arising from those amounts and included in the VAT base,
- VAT paid in respect of anti-dumping and countervailing duties applied under the relevant legislation on the prevention of unfair competition in imports, and in respect of all taxes, duties, charges and shares arising from those amounts and included in the VAT base.
Accordingly, VAT that may not be deducted may be treated as an expense or cost. Taxpayers should review their statutory accounting systems and make the necessary corrections in order to avoid assessments with penalties.