ECONOMY

Turks amend vehicle tax law

ANKARA (Reuters) – Turkey’s Parliament has pushed through a revision of a key IMF-backed vehicle tax measure, annulled by the constitutional court last week, as part of a package of fiscal reforms. The annulment had raised concerns about the government’s ability to raise sufficient revenues to meet its budget targets and win approval for the latest $500 million loan tranche under its $16 billion pact with the IMF. Deputies approved the revised supplementary vehicle tax at a session late on Tuesday. The tax had been targeted to raise 1,100 trillion lira ($783 million) but the court ruled it unconstitutional last week. Automotive sector officials have voiced concern that the law will harm the sector’s performance this year, jeopardizing a sales target of 300,000 units. It is not clear whether Ankara has taken sufficient revenue-raising measures for the IMF’s executive board to meet and approve the latest loan tranche. Finance Minister Kemal Unakitan said yesterday he expected the IMF board to meet this week. Officials have already collected 393.7 trillion lira from the motor vehicle tax prior to its annulment. According to the legal amendment, those buying cars after April 1 will also pay the tax.