Türkiye Offers 20-Year Tax Exemption on Foreign Income to Attract Global Wealth
By Bosphorus News Economy Desk
On April 24, President Recep Tayyip Erdoğan announced a new economic reform package in Istanbul aimed at attracting foreign capital and high-net-worth individuals, including a proposal to exempt qualifying new residents from tax on foreign-source income for up to 20 years.
Speaking at an investor-focused event at the Dolmabahçe Working Office, Erdoğan set out the measure in direct terms:
"Persons living abroad who have not been tax residents in our country for the past three years, if they come to Türkiye, we will not collect tax on their foreign-source income and earnings for 20 years. We will only tax their domestic income, if any."
The proposal forms part of a broader legislative package that has not yet been submitted to parliament and includes corporate tax cuts, expanded trade exemptions and new investment facilitation mechanisms.
The 20-Year Exemption
The personal tax measure targets individuals relocating to Türkiye who have not been tax residents in the country over the previous three years. Under the proposal, foreign-source income and capital gains would be fully exempt from Turkish taxation for two decades, while inheritance and gift tax for eligible individuals would be set at a flat one percent.
Exporters and Trade Income
The package also introduces significant tax reductions for exporters. Manufacturing exporters would face a corporate tax rate of nine percent, while other exporters would be taxed at fourteen percent.
Companies engaged in transit trade and cross-border intermediation would see the existing fifty percent tax deduction raised to one hundred percent for firms operating within the Istanbul Finance Centre, effectively eliminating corporate tax on those earnings. Outside the centre, a ninety-five percent exemption would apply.
Regional headquarters managing overseas operations from Türkiye would fall under the same exemption framework, while selected employees could benefit from targeted wage tax relief.
Positioning for Capital Flows
The package includes a separate mechanism allowing individuals and companies to repatriate foreign-held assets, including cash, gold and securities, under reduced tax conditions.
A centralised digital investment platform is also planned, bringing together company registration, permits, tax procedures and regulatory approvals under a single system coordinated by the Presidential Investment Office.
The proposal would place Türkiye ahead of comparable European regimes if enacted, with longer exemption periods and no flat tax on foreign income. The timing coincides with shifting global conditions, as disruptions linked to the Iran war reshape energy flows and capital allocation patterns across the region.
Parliamentary Approval Pending
None of the measures are currently in force. The full legislative package is expected to be submitted to parliament, though no timeline has been specified. Final eligibility criteria, documentation requirements and implementation details will depend on the text of the bill.