New deferment facility for debts

Law No. 7440 was last enacted in 2023 for the restructuring of tax and premium debts. In the restructuring laws, the current value of the tax and premium debts that were not paid on maturity was first increased by the inflation rate or a fixed rate below the inflation rate. A maturity difference was applied to this amount according to the number of installments. The maturity difference was generally below inflation.

This year, unlike the restructuring laws, tax and premium debts were granted relief within the scope of the Public Receivables Law No. 6183. Normally, in order to defer debts within the scope of Law No. 6183, it is necessary to experience payment difficulties if the debt is paid on time. This year, debts can be paid in installments for up to 72 months, without the requirement of having difficulty in paying, and the deferred interest rate, which was 39 percent, has been reduced to 29 percent. However, the principal of the debt was first updated by applying a delay interest of 3.7 percent monthly (44.4 percent annually) to the principal debt of the taxpayer who applied for postponement. A 29 percent deferment interest was applied on this amount.

The amount of debt that can be deferred without collateral has been increased to 10 million lira. For debts exceeding ten million liras, 50 percent guarantee is required.

Applications for deferment relief in premium debts ended on 31 August, and applications for premium relief in tax debts ended on 30 September. The first installments were also collected as of the application deadline.

According to the information provided by the Minister of Treasury and Finance Mehmet Şimşek, 705 thousand taxpayers applied to the tax offices for a debt of 531.5 billion liras within the scope of ease of deferment. 35.6 billion lira was collected from tax debts.

Although the number of installments was increased from 36 months to 72 months, 72 months was granted to taxpayers who were more able to pay.

The ease of postponement ended on the said dates. After this date, taxpayers who want to defer their debts will first be checked whether they have difficulty paying. If he has difficulty paying, his debt will be postponed, but the deferment interest will be applied as 39 percent.

During the budget discussions of the Ministry of Treasury and Finance in the Grand National Assembly of Turkey Plan Budget Commission last week, the people's alliance and opposition MPs stated that a restructuring arrangement should be made for tax and premium debts. İzzet Akbulut and Mehmet Tahtasız from the New Party, Erhan Usta from the İYİ Party, Gülizar Biçer Karaca and Nermin Yıldırım Kara from the CHP, Mustafa Kalaycı, Tamer Osmanağaoğlu and İsmail Faruk Aksu from the MHP, Saruhan Oluç from the DEM Party, and Sadullah Kısacık from the New Path Party explained that they constantly receive messages from taxpayers who cannot benefit from the deferment facility due to high interest rates.

Mustafa Kalaycı from MHP said that partial reductions in interest rates are not a solution and that tradesmen demand a similar restructuring made with Law No. 7440. Stating that the tradesmen do not have a request for tax amnesty or cancellation of their debts, Kalaycı said, "Taking into account the difficult period we are going through, making a restructuring under appropriate conditions for tax and premium debts, as has been implemented many times in the past, will give respite to our tradesmen and farmers and will accelerate the collection of public receivables."

CHP's Nermin Yıldırım Kara also stated that tradesmen could not benefit from the ease of deferment because late payment increases were considered as principal, and that in calculating the debt amount, the principal should be calculated with a fixed interest rate from the maturity date.

Erhan Usta from İYİ Party said that although the number of installments was increased to 72 in the deferment facility, taxpayers could not benefit from this installment opportunity.

Minister of Treasury and Finance Mehmet Şimşek gave the good news of a new ease of deferment and announced that they plan to reduce the late payment interest and deferment interest rates in line with market conditions in the coming period. Minister Şimşek emphasized that the request for debt restructuring within the scope of Law No. 6183 came from both the opposition and the people's alliance and that it was a "reasonable request". Stating that they increased the number of installments to 72 months during this year's deferment facility and reduced the deferment interest from 39 percent to 29 percent, Şimşek said, "As far as I understand, this is not considered sufficient."

Stating that more attractive opportunities could be provided for tradesmen and small businesses, but they are concerned that this would be contrary to the principle of equality of the Constitution, Şimşek continued as follows:

"I am sure you will not appreciate the fact that we put those who pay their taxes on time and those who do not pay them in the same category. Therefore, perhaps the following can be done: We have solved the issue of guarantee to a large extent. As you know, an authorization has been received from here, guarantee is not required up to 10 million TL. A guarantee of 50 percent is required above 10 million TL. Seventy-two monthly installments are actually a good term. Now, all that remains is interest. We should take as radical an approach as we can regarding interest. "Let's go in."

Upon Erhan Usta's objection that 72 months were never implemented, Şimşek said, "Well, then, let's put forward a will to implement 72 months."

Minister Şimşek, in his statement made many times before regarding the ease of deferment provided for debts, said that they do not favor the application of interest rates below inflation. The biggest criticism from taxpayers about the ease of deferment introduced this year was the high delay interest applied to the principal of the debt.

Late payment interest will be 1.6 percent (annual 19.2 percent) between 30 December 2019 and 20 July 2022, 2.5 percent monthly (30 percent annually) between 21 July 2022 and 13 November 2023), 3.50 percent monthly (42 percent annually) between 14 November 2023 and 20 May 2024, 21 May. Between 2024 and 12 November 2025, it was 4.50 percent monthly (54 percent annually). It has been applied as 3.70 percent monthly (44.40 percent annually) since November 13, 2025.

If the taxpayer has an unpaid debt of 1000 lira, which is due on October 31, 2023, on the date of the postponement application, this debt is first calculated at the rate of the late payment interest applied on the relevant dates. Deferred interest, reduced from 39 percent to 29 percent annually, is applied to this calculated total amount. However, since the principal amount increased a lot due to the high late payment interest, it was not attractive to taxpayers despite the ease of maturity and the discount in the deferment interest.

The late payment interest rate is well above inflation, especially for the period after 2023.

The biggest convenience for taxpayers in the restructuring laws was actually made in the late payment penalty applied to the principal of the debt. By applying a fixed coefficient in years when inflation was high, excessive increase in the principal of the debt was prevented. A reasonable interest rate was applied to this calculated amount.