INVESTMENT GUIDE

Technology Development Zones (TDZ)

Technology Development Zones (TDZ) are designed areas to support research and development (R&D) initiatives and attract investments in high-tech sectors. Currently, there are 101 TDZs, with 87 operational and 14 under construction.

Advantages of TDZs

1. Tax Exemption: Profits derived from software development, R&D, and design activities are exempt from income and corporate taxes until December 31, 2028.
2. VAT Exemption: Sales of application software produced within TDZs are exempt from VAT until December 31, 2028. This includes software categories such as system management, data management, business applications in different sectors, internet, mobile phones, and military command control systems.
3. Personnel Tax Exemption: Wages related to R&D, design, and support personnel working within the TDZ are exempt from all taxes until December 31, 2028. However, tax exemption for support personnel cannot exceed 10% of the total R&D workforce.
4. Production Investments: Investments aimed at producing technological products developed as a result of R&D projects within the TDZ can be made in the region, subject to the approval of the operating company and necessary permissions from the Ministry of Industry and Technology.
5. Social Security Premium Support: 50% of the employer’s share of the social security premium is covered by the state until December 31, 2028.
6. Customs Duty and Stamp Duty Exemption: Products imported for R&D, design, and software development projects are exempt from customs duties, and related documents are exempt from stamp duty.

Organized Industrial Zones (OIZ)

Organized Industrial Zones (OIZ) are designed to allow companies to operate using ready infrastructure and social facilities. This includes roads, water, natural gas, electricity, communication, waste treatment, and other services.

There are currently 392 OIZs across 81 provinces in Turkey, with 274 operational and 118 under construction. Over 67,000 companies operate in more than 32,000 parcels within OIZs, providing employment to over 2 million people.

Advantages of OIZs

1. VAT Exemption on Land Purchases.
2. Property Tax Exemption: Exemption from property tax for five years from the completion of the facility construction.
3. Low Utility Costs: Reduced costs for water, natural gas, and communication.
4. Tax Exemption on Parcel Transactions: Tax exemption on the subdivision/merging of parcels.
5. Municipal Tax Exemption: Exemption from local administration taxes during the facility construction and operation phases.
6. Exemption from Solid Waste Tax: If the OIZ does not benefit from municipal services.

Free Zones

Free Zones are special areas located within the political borders of a country but outside the customs borders, designed to increase export-oriented investments. Legal and administrative regulations applied in customs zones are either not implemented or partially implemented in free zones.

There are 19 Free Zones in Turkey, with 18 operational and 1 under construction. These zones are strategically located near Mediterranean, Aegean, and Black Sea ports, facilitating easy access to international trade routes.

Advantages of Free Zones

1. 100% Exemption from Customs Duties and Similar Taxes.
2. 100% Exemption from Corporate Tax for Manufacturing Companies.
3. 100% Exemption from VAT and Special Consumption Tax.
4. 100% Exemption from Stamp Duty on Documents.
5. 100% Exemption from Property Tax.
6. Income and Corporate Tax Exemption for Certain Logistics Services: 100% exemption from income and corporate tax for certain logistics services provided entirely to abroad.
7. Income Tax Exemption on Employee Wages: 100% exemption from income tax on wages for employees, provided that the company exports at least 85% of the FOB value of the products produced in the Free Zones.
8. No Time Limitation: Goods can be kept in the Free Zones without any time limitation.
9. Free Transfer of Profits: Companies can freely transfer profits obtained in the Free Zones abroad or to Turkey without any restrictions.
10. Exemption from Title Deed Fees on Property Transactions.
11. Exemption from KDV and Other Taxes on Construction and Infrastructure.
12. Permission for Second-hand/Used Machinery Importation.

Industrial Zones

Industrial Zones are special areas aimed at enhancing the global competitiveness of the national economy, facilitating technology transfer, increasing production and employment, accelerating the flow of international capital, and creating suitable industrial areas for large-scale investments. Currently, there are 40 Industrial Zones across various regions.

Advantages of Industrial Zones

1. Acquisition of Easement Rights.
2. Eligibility for Public Investment Financing from the Ministry of Industry and Technology (MoIT) Budget.
3. MoIT or Operator Company as the Authorized Institution in Applications.
4. Accelerated and Simplified Bureaucratic Processes for Investors.
5. Establishment of an Investment-friendly Environment for Advanced Technology.
6. Significantly Reduced Easement Rights: Easement rights are provided at much lower rates, 8-10 times cheaper than those offered for Treasury lands outside the Industrial Zones.
7. Additional Incentives: Additional incentives can be granted by the President.