The AK Party administration announced that there is no regulation under consideration that would provide Special Consumption Tax exemption for scrap vehicles. There is also no legal work being conducted by the government on this matter.

After a proposal submitted to the Turkish Grand National Assembly (TBMM), the issue of incentives for scrap vehicles has been finalized.

Members of parliament submit dozens of proposals to the TBMM every day. One of these proposals stood out, leading to interpretations in the public eye that a law with Excise Tax (ÖTV) exemption for scrap vehicles was on the way. However, the government is not working on this issue, and the proposal has yet to reach any committees.

The idea of withdrawing vehicles older than 25 from traffic to ease congestion and ensure environmental safety has been circulating for some time, affecting second-hand car prices. Rumors of the law being passed caused an increase in the market value of old vehicles.

The scrap incentive is an application that allows for Excise Tax exemption when purchasing a new vehicle in exchange for scrapping a vehicle older than 25 years. Owners of such vehicles do not pay the Excise Tax when purchasing a new one. Although this practice was implemented in the past, it is currently not on the agenda.

AK Party sources stated that there is no current legislation being considered, emphasizing that speculations have been made in the market regarding scrap vehicles.

Sources highlighted that individuals causing these speculations collected many scrap vehicles from the market by claiming that a “Incentive Law will be passed,” noting that while there have been numerous requests for incentives, there is currently no consideration for such a regulation or Incentive Law.

HOW DID THE ISSUE COME TO THE AGENDA?

MHP Kayseri Deputy Ismail Özdemir recently submitted a bill to the Assembly, proposing an Excise Tax reduction for those who scrap their vehicles and purchase new ones produced in Turkey, with the aim of renewing vehicles older than 25 to boost the economy.

The scrap vehicle incentive was first implemented in Turkey in 2003. This helped in phasing out older vehicles from the market, while also increasing new vehicle sales. The practice ended in 2004. A second scrap incentive was introduced from October 4, 2010, until December 31, 2011. Unlike the initial incentive, this one restricted the vehicle type to those weighing over 3.5 tons, including both commercial and passenger vehicles.