The Government decides to increase the existing Value Added Tax (VAT) rate to 18% with effect from 01-01-2024.
Also, steps will be taken to impose the tax on certain goods and services for which the current value added tax is not applicable.
The government says the move is being taken to meet tax revenue and primary balance targets as agreed with the International Monetary Fund.
Accordingly, the Cabinet of Ministers has approved the implementation of some new tax proposals from 01-01-2024 and to amend the relevant laws in yesterday’s meeting.
A number of tax base increasing and progressive tax policy proposals have been implemented from June 2022 for revenue-based fiscal stability with the aim of ensuring debt sustainability.
As a result, government tax revenue has increased by 51% in the first 9 months of 2023 compared to 2022.
However, it has not yet been able to meet the tax collection targets agreed with the International Monetary Fund.
