What will be the worker's tax in 2027?

Income tax is deducted before the earnings of workers and civil servants enter their pockets. The portion of everyone's earnings up to the minimum wage has been exempt from tax since 2022. Income tax for earnings exceeding the minimum wage starts from 15 percent and goes up to 20 percent, 27 percent, 35 percent and 40 percent. Which tax rate will be applied to which earnings is determined at the beginning of each year according to the income tax tariff. The tax tariff is normally increased every year by the revaluation rate. The President is authorized to increase or decrease the amount increased by the revaluation rate by up to 50 percent.

In 2026, 15 percent of the earnings of salaried employees up to 190 thousand TL, 20 percent for the part between 190,000 TL and 400,000 TL, 27 percent for the part between 400,000 TL and 1,500,000 TL, and 2 percent for the part between 1,500,000 TL and 5,300,000 TL. 35, 40 percent tax is applied to the amount exceeding 5,300,000 TL.

The revaluation rate was 27.83 percent this year. Fractions below 5 percent are not taken into account during the increase with the revaluation rate. Accordingly, when the revaluation rate is increased, the income tax brackets in 2027 will be as follows:

15 percent on earnings up to 240,000 TL,

20 percent on earnings between 240,000 TL and 500,000 TL,

27 percent for earnings between 500,000 TL and 1,900,000 TL,

35 percent for earnings between 1,900,000 TL and 6,700,000 TL,

40 percent for earnings over 6,700,000 TL.

If the President uses his authority to increase by 50 percent, the first tax bracket will increase to 360 thousand liras, the second tax bracket will increase to 750 thousand liras, and the third tax bracket will increase to 2 million 850 thousand liras.

Increasing the tax bracket means entering the upper tax rate later. In particular, the increase in the first tax bracket ensures that the majority of employees enter the 20 percent tax bracket later and their net wages increase.

5 PERCENT FRACTIONS ERASE THE TAX BRANCH

Ignoring fractions below 5 percent when increasing the tax bracket according to the revaluation rate causes the income tax bracket to be lower than it should be. For example, the first tax bracket increased by 33.33 percent instead of 36.20 percent in 2022, by 118.75 percent instead of 122.93 percent in 2023, by 57.14 percent instead of 58.46 percent in 2024, and by 20.25 percent instead of 25.49 percent in 2026. The tax tariff will increase by 26.32 percent instead of 27.83 percent in 2027 if the law is implemented exactly as it is.

Even ignoring the fractions below 5 percent in the last 6 years reduced the first tax bracket from 266,606 lira to 240 thousand lira.

Moreover, when determining tax tariffs in 2000, 2001 and 2002, they were increased below the revaluation rate. If the tax tariff had been increased directly at the revaluation rate since 2000, the first tax bracket would have reached 666 thousand 266 lira in 2027 instead of 240 thousand lira. In this case, for a profit of 666 thousand 266 liras, 99 thousand 940 liras of tax would be paid in 2027 instead of 133 thousand liras. The worker would have 33,060 TL left in his pocket.

THE RATIO OF THE FIRST TAX TRAFFLE TO THE MINIMUM WAGE HAS DECREASED

The first tax bracket was 21.9 times the minimum wage in 2000. The rate, which was 19.5 times in 2001 and 16.1 times in 2002, was approximately 12 times in 2008-2012. The ratio of the first tax bracket to the minimum wage fell below ten times in 2014. The first tax bracket in 2026 was only 5.75 times the minimum wage.

The minimum wage was determined in January and July in some years and only in January in some years. In the calculations here, the averages for January and July were taken into account. TÜRK-İŞ, HAK-İŞ and DİSK, as well as the employer union TİSK, frequently bring up the issue of increasing the income tax tariff.

In its previous statement, TÜRK-İŞ requested that the first tax bracket be increased to 17 times the minimum wage, as in 2002, taking into account the minimum wage in January.

If the first tax bracket was 17 times the minimum wage, it would be 561,510 lira instead of 190 thousand lira in 2026. In this case, salaried employees would pay 84 thousand 226 lira income tax instead of 114 thousand 108 lira in 2026 for an income of 561,510 TL.