We mentioned recently (3rd April 2009), how the Turkish government has been easing the burden of taxation on some sectors of the economy in order to stimulate domestic spending.  Taxes have come down significantly, if temporarily, on products such as new cars, electrical goods, furniture and larger new build properties.

However did you know that the Turkish government is raising taxes on food and drink in tourist areas such as Kalkan.  In fact, all along the Mediterranean and Aegean Coast, and some other tourist hot spots, KDV is set to increase by a massive 10%.  The following table illustrates the position over the last three years.

The taxes are levied on all establishments serving tourists, such as bars, restaurants, cafes and clubs and the increased 2009 rates are already in force.  Business owners are having to adapt to these changes and their options are clear.  They either absorb the increase of 10% on food and soft drinks or they pass it on to you the customer - or take a position somewhere in between.

It could be argued that the rates are simply reverting back to 2007 levels, however given the current economic conditions, business owners and customers are unlikely to welcome this move.