Additional tariffs on subsidized imports

THE TURKISH government implemented a 30 percent tariff on an additional 859 products last week, after imposing tariffs on 3,000 products in April and over 400 products on May 11. Hence, the number of products subject to additional tariffs surpassed 4,500 in the previous month. While these new tariffs directly impacted those who use imported products, the new decision came as a surprise to investors with incentive certificates who are not required to pay customs duty as per the legislation.

These investors, who were allowed to import duty-free machines, are now faced with additional tariffs as part of the measures against the outbreak. The authority fined various investors with incentive certificates three times the amount of the tariff.

Additional tariffs and customs duty are not the same thing so investors with incentive certificates are expected to pay these tariffs, according to the Ministry of Industry and Technology. Various investors applied to the Ministry of Trade to be exempted from these tariffs after the supposedly duty-free imported machines arrived in Turkey. Referring to the Customs Communique, investors underlined that “Regarding investment incentive certificates, imported machines and equipment are exempted from customs duty and value-added tax (VAT)”, arguing that they are not subject to additional tariffs.

Following the objection, the Ministry of Trade transferred the issue to the Ministry of Industry and Technology. The Ministry of Industry concluded that imports through investment incentive certificates are only exempted from customs duty and VAT and that these investments are subject to additional tariffs. Like previous additional tariff announcements, the ministry published two separate product lists. The first list will take effect on •ctober 1 and the latter will be imposed until September 30.