There are four types of special investment zones in Turkey:
1. TECHNOLOGY DEVELOPMENT ZONES - TECHNOPARKS
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Technology Development Zones (TDZs) are areas designed to support R&D activities and attract investments in high technology fields.
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There are 37 TDZs of which 26 are operational, and 11 have been approved and are currently under construction. Ankara has six TDZs, Istanbul has five, Kocaeli has three, while the other provinces listed in the pop-up table below have one each.
"List of TDZs in Turkey”
*Please note that the TDZs marked with (*) are operational.
Advantages of TDZs:
- Offices ready to rent and infrastructure facilities provided.
- Profits derived from software and R&D activities are exempt from income and corporate taxes until December 31, 2013.
- Deliveries of application software produced exclusively in TDZs are exempt from VAT until December 31, 2013. Examples include software for systems management, data management, business applications, different business sectors, the Internet, mobile phones and military command control.
- Salaries of researchers, along with software and R&D personnel employed in the zone are exempt from all taxes until December 31, 2013.
- A VAT exemption is provided for IT specific sectors during the exemption period for income and corporate taxes.
2. ORGANIZED INDUSTRIAL ZONES (OIZs)
Organized Industrial Zones (OIZs) are designed to allow companies to operate within an investor- friendly environment with ready-to-use infrastructure and social facilities.
- The ready infrastructure provided in the zones includes roads, water, natural gas, electricity, communications, waste treatment and other services.
- There are 263 OIZs in 80 provinces, 148 of which are currently operational, while the remaining 115 OIZs are being constructed throughout Turkey.
List of OIZs in operation by province
Advantages of OIZs
In addition to the investment incentives scheme in Turkey (general investment incentives, incentives for large scale investments, region and sector-based incentives, incentives on employment, R&D supports and etc.), investors operating in the OIZs can benefit from the following advantages:
- No VAT for land acquisitions
- Exemption from real estate duty for five years starting after the construction of the plant
- Low water, natural gas and telecommunication costs
- For unification and/or separation of plots no tax to be paid (which is about %0.54 of the total cost)
- Exemption from municipality tax for construction and usage of the plant
- Exemption from the municipality tax on solid waste if the OIZ does not benefit from the municipality service
3. INDUSTRIAL ZONES
- Industrial zones are designed to provide sites suitable for large-scale and technology-intensive investments.
- The Council of Ministers approves the industrial zones after an evaluation of the investment sites by the Ministry of Industry and Trade.
- Investments made in an industrial zone are required to be in a high-technology sector and to have an investment site of a minimum of 1,500 m2.
- Industrial zones also benefit from all of the advantages provided to OIZs.
4. FREE ZONES
- Free zones are special sites considered outside the customs area, although they are within the political borders of the country. These zones are designed to increase the number of export-focused investments.
- Legal and administrative regulations in commercial, financial and economic fields that are applicable within the customs area are either not implemented or partially implemented in the free zones.
- There are 20 FZs in Turkey located close to the EU and Middle Eastern markets adjacent to major Turkish ports on the Mediterranean, Aegean and Black Seas, with easy access to international trade routes.
List of FZs
Advantages of FZs:
- 100% exemption from customs duties and other assorted duties.
- 100% exemption from corporate income tax for manufacturing companies.
- 100% exemption from value added tax (VAT) and special consumption tax.
- 100% exemption from income tax on employees’ salary (for companies that export at least 85% of the FOB value of the goods they produce in the free zones).
- Goods can remain in free zones for an unlimited period.
- Companies are free to transfer profits from free zones to abroad as well as to Turkey, without restrictions.