27/06/2023

Turkish Authorities Update Tax Rates for July 2023: A Collaborative Effort Leading to Salary Increment

turkish tax

In a recent development, Turkish authorities have announced the update of tax rates for July 2023. This update brings about significant changes to the minimum wage and salaries of civil servants and pensioners.

The Ministry of Labor and Social Security, in close collaboration with the Ministry of Treasury and Finance, has worked diligently to ensure the successful implementation of these adjustments.

Addressing inquiries from journalists regarding the impending salary increase, Işıkhan, a government representative, shed light on the government’s position. He emphasized the joint efforts of the two ministries, emphasizing their commitment to realizing this important change. The proposed salary increment is expected to be presented to the Turkish Parliament in July, aiming to establish a minimum salary of 22,000 liras for civil servants. This initiative aligns with the vision of President Erdogan, who seeks to improve the financial well-being of public employees. Işıkhan further explained, “Our objective is to achieve an outcome that satisfies all the stakeholders involved in the comprehensive bill.”

Alongside the adjustments for civil servants and pensioners, the Turkish government has also implemented a substantial increase in the minimum wage. Workers can now anticipate a higher minimum gross salary of 13,414 liras per month. However, it is crucial to consider the impact of taxes and deductions, as they significantly affect the net minimum wage. After factoring in these components, the net minimum wage stands at 11,402 liras.

Breaking down the gross minimum wage of 13,414 liras and 50 cents, we arrive at a minimum net salary of 11,402 liras and 32 cents. Out of this amount, the SGK premium accounts for 1,878 liras and 3 cents, while the unemployment insurance premium amounts to 134 liras and 15 cents. These deductions are essential for ensuring various social security benefits and coverage for workers.

Examining the overall monthly expense from an employer’s perspective, the revised minimum wage entails a total of 15,762 liras and four kurus. This sum includes the minimum gross salary of 13,414 liras and 50 cents, the employer’s share of the SSI premium, amounting to 2,079 liras and 25 cents, and the employer unemployment insurance premium, which comprises 268 liras and 29 cents. Employers must factor in these expenses when calculating the costs associated with the revised minimum wage.

In conclusion, the Turkish authorities’ update of tax rates for July 2023 brings significant changes to the minimum wage and salaries of civil servants and pensioners. This update reflects the collaborative efforts of the Ministry of Labor and Social Security and the Ministry of Treasury and Finance. The proposed salary increment aims to establish a minimum salary of 22,000 liras for civil servants, aligning with President Erdogan’s vision. Additionally, the minimum wage for workers has been significantly raised, resulting in a higher gross salary of 13,414 liras. However, it is essential to consider the impact of taxes and deductions, which reduce the net minimum wage to 11,402 liras. Employers must be aware of the total monthly expense associated with the revised minimum wage, which includes the minimum gross salary, SSI premium, and employer unemployment insurance premium. These updates signify the government’s commitment to improving the financial well-being of workers and ensuring a fair and sustainable economic environment.

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