1/11/2008

FT: Turkey pledges fairer taxation for employers

The Financial Times - Turkey’s government yesterday promised a fairer tax system and lower social security premiums for employers in a programme that analysts said was ambitious but lacked detail. Nearly six months after winning a landslide general election that returned it for a second five-year term, the pro-business government unveiled a 145-point “action plan” . Mr Erdogan said the 145 points, focusing on education, energy and the labour sector, would form the core of his government’s policies. He said they represented a commitment to the “social restructuring” of Turkey after a first term dominated by economic reform and the need to ensure the country shed the legacy of a disastrous financial crisis in 2001. Measures that investors are likely to focus on include a reduction of 5 percentage points in employers’ social security contributions and the ending of direct income support for farmers, instead offering them product price support. Mr Erdogan said he wanted to boost employment, reduce the unregistered economy, improve the investment climate, and increase the quality and effectiveness of social services and public spending.