ECONOMY

Turk tax revenues up

ANKARA (Reuters) – Turkish tax revenues will be higher than a revised target of 151 billion lira ($127 billion) this year, the head of the country’s revenue adminstration body, Osman Arioglu, told reporters on Friday. Turkey had revised the revenue target down to 151 billion lira from a target of 158 billion lira which it set at the start of the year. The State Planning Organization, a part of the prime minister’s office which focuses on economic development, said in September that low levels of tax collection this year posed a serious risk to year-end budget targets. Turkey has posted larger-than-expected budget deficits this year as spending increased ahead of parliamentary elections in July. Arioglu said declared value-added tax rose 23 percent in the first 10 months. «There is no problem with tax collection; 2007’s tax goals have been met as of today,» he said. New jobs Future Turkish tax cuts should aim to create new jobs and support production, Economy Minister Mehmet Simsek said on Friday. The government, re-elected in July, has promised to reduce a large unregistered economy, simplify the tax system and reduce tax on employment. »If Turkey is to cut value-added tax, its aim should be to encourage employment,» Simsek told a conference. He said the government would implement social security reform, cut the tax burden on employment and reduce the unregistered economy between 2007 and 2012. The unemployment rate in Turkey is 8.8 percent, according to the latest data, despite economic growth of more than 7 percent over the last four years, as a fast-growing population and urban migration swell the jobless ranks. The government has already cut corporate tax to 20 percent from 33 percent in a move to attract more foreign direct investment. Simsek also said a total of $16 billion entered into Turkey’s coffers in the last two years thanks to privatization of state companies.