Turkey Unveils "Radical" 20-Year Tax Holiday to Become Global Investment Hub

ISTANBUL – In a move aimed at fundamentally reshaping Turkey’s economic landscape, President Recep Tayyip Erdogan has announced a sweeping fiscal incentive package designed to lure global wealth, corporate headquarters, and high-net-worth individuals. The centerpiece of the proposal—a 20-year tax exemption on foreign-source income—represents one of the most aggressive "non-dom" tax regimes ever introduced globally.

Speaking at the “Turkey Century Strong Center for Investment Program” at the Dolmabahce Working Office, Erdogan characterized the measures as a "radical step" to position Turkey as an "indispensable hub" for global energy and trade corridors.

Turkey unveils radical 20-year tax holiday on foreign-source income – zero tax for new residents.

A Global Outlier: The 20-Year Tax Holiday

The proposed rules create a unique fiscal haven for incoming foreign residents. Under the framework, individuals who have not been Turkish tax residents for at least three years can relocate to Turkey and enjoy:

• Zero Tax on Foreign Income: A full 20-year exemption on all income and capital gains generated outside of Turkey.

  
  

• Domestically Targeted Taxation: Only income earned within Turkish borders would be subject to the national tax net.

  
  

• Elite Inheritance Rates: A flat 1% inheritance and gift tax for qualifying individuals, a massive reduction from the standard progressive rates that currently top out at 30%.

  
  

How Turkey Compares to European Rivals

Turkey’s proposal significantly outmuscles existing European "non-dom" programs in both duration and cost:

Country	Program Duration	Annual Flat Fee
Turkey (Proposed)	20 Years	€0
Italy	15 Years	€300,000
Greece	15 Years	€100,000
Portugal (IFICI)	10 Years	N/A (Reduced rates)

The Final Piece for Citizenship by Investment (CBI)

For years, Turkey’s popular Citizenship by Investment (CBI) program has lacked a strong fiscal incentive for those choosing to actually reside in the country. Currently, CBI holders who become residents are taxed on their worldwide income at rates between 15% and 40%.

This new holiday effectively eliminates that burden, potentially turning Turkey into the world’s most attractive jurisdiction for dual-national entrepreneurs and "digital nomads" with global portfolios.

Corporate Incentives: A Play for Regional Dominance

Beyond personal taxes, the package includes deep cuts to corporate levies, particularly for exporters and transit trade.

• Manufacturing Exporters: Corporate tax slashed from 25% to 9%.

  
  

• Other Exporters: Rate reduced to 14%.

  
  

• Transit Trade (IFC): Companies operating within the Istanbul Finance Centre (IFC) will see a 100% corporate tax exemption on transit trade income.

  
  

• Regional Headquarters: Companies managing overseas operations from Turkey will benefit from a 95% to 100% tax exemption structure for two decades.

  
  

Expert Insight: Taymour Polding of CIP Turkey noted, “This move will elevate Turkey’s status to a major global powerhouse. Given the strategic location, this feels like the final piece of the puzzle.”

Geopolitical Timing: The "Island of Stability"

The timing of Ankara’s announcement is widely viewed as a strategic play for capital fleeing instability in the Middle East. With the ongoing war in Iran damaging infrastructure in traditionally dominant hubs like the UAE and Qatar, Turkey—protected by NATO air defenses—is positioning itself as a secure alternative.

"Every business circle is trying to find its way through a thick fog," Erdogan observed, positioning Turkey as the clear path forward for those seeking both safety and fiscal efficiency.

Next Steps and Legislative Approval

While the announcement has sent ripples through the global investment community, the package still requires approval from the Turkish Parliament. President Erdogan has not yet specified a date for the formal submission of the legislative bill. Until enacted, the exact eligibility criteria and documentation requirements remain subject to final drafting.

For ongoing updates on Turkey’s investment climate, citizenship laws, and tax reforms, visit:

visasupdate.com/blog/categories/turkey (Regional European & Eurasian Updates)