Türkiye proposes 20-year tax exemption on foreign income

President Recep Tayyip Erdoğan announced an investment-tax reform package on 24/04/2026 at the “Türkiye Century Strong Center for Investment Program” event held at the Dolmabahçe Office, Istanbul. The proposed package offers a 20-year tax exemption in Türkiye on foreign income and capital gains for eligible individuals who relocate to the country. The proposal has not yet become law and is awaiting parliamentary approval.

20-year personal tax exemption mechanism

According to the proposal, individuals who have not been tax residents of Türkiye in the last 3 years will be able to relocate and be exempt from Turkish tax on foreign income and capital gains for 20 years. Only income generated domestically will be subject to tax in Türkiye.

President Erdoğan stated that eligible individuals will also benefit from a fixed 1% inheritance and gift tax rate, replacing the current progressive tax system. Türkiye’s current personal income tax applies a progressive scale from 15% to 40%.

Impact on citizenship by investment programmes

The Türkiye citizenship by investment programme currently allows investors to purchase real estate for a minimum of US$400,000 and hold it for 3 years to be granted citizenship. If the proposal is passed by Parliament, CBI holders who become tax residents in Türkiye, who currently face a 15-40% progressive tax rate on global income, will be fully exempt from tax on foreign income.

According to analysis on Türkiye Today, this proposal will add a financial dimension to the Türkiye CBI programme, which was previously known primarily for its processing speed, property access and the visa-free travel of the passport. According to legal sources, CBI holders who have not been tax residents in Türkiye in the 3 years prior may be eligible for the 20-year tax exemption, but the final legislation will determine the scope of application.

Comparison with preferential tax regimes in Europe

Türkiye’s 20-year proposal exceeds the duration of equivalent regimes in Europe. According to Türkiye Today and bne IntelliNews, Italy’s lump-sum tax regime currently lasts for a maximum of 15 years at a rate of EUR 300,000 per year (increased from EUR 200,000 under the 2026 Budget Law). Greece’s non-domiciled (non-dom) regime also lasts for a maximum of 15 years and requires a lump-sum tax of EUR 100,000 per year. Portugal’s Incentive for Scientific Research and Innovation (IFICI) regime—often called NHR 2.0—grants a 10-year incentive.

A key difference is that the Türkiye proposal does not require an annual lump-sum tax on foreign income, whereas all EU regimes have a fixed fee.

Parallel corporate tax reform

Alongside the personal regime, the package includes corporate tax adjustments. According to Daily Sabah, corporate income tax for manufacturing exporters will be reduced from the standard 25% to 9%. Other exporters will benefit from a 14% rate.

For transit trade and cross-border commodity brokerage, the current 50% income deduction will be increased to 100% for businesses operating in the Istanbul Financial Center (IFC), effectively exempting this type of income from tax entirely. Businesses outside the IFC will receive a 95% exemption on profits from transit trade. Regional headquarters operating from Türkiye will benefit from a 95-100% exemption mechanism for 20 years.

Erdoğan also stated that the Government will issue a mechanism allowing Turkish citizens and businesses to repatriate assets held abroad—cash, gold and securities—to Türkiye within a specified timeframe and at a preferential tax rate.

One-stop mechanism and geo-economic context

To simplify procedures, Erdoğan announced the establishment of a single-window mechanism coordinated by the Presidency’s Investment and Finance Office, integrating all administrative procedures: business registration, work permits, tax registration, land incentives and environmental impact approvals.

According to bne IntelliNews, the timing of the announcement was not coincidental. The conflict in Iran damaged infrastructure in the United Arab Emirates (UAE), Saudi Arabia and Qatar, whereas Türkiye — defended by NATO air defence systems — remained largely unaffected. According to Türkiye Today, President Erdoğan described Türkiye as an “island of stability” in the region and an “indispensable base for the region’s energy and trade corridors”.

Minister of Finance Mehmet Şimşek previously confirmed that the Government is preparing radical incentive measures to attract international capital. Bloomberg reported on 08/04/2026 that the Ministry of Finance is drafting legislation to expand IFC incentives for foreign businesses nationwide.

Legal status and notes

The entire package of measures remains at the proposal stage. According to Türkiye Today, the measures will be submitted to Parliament, but no specific date has been set. President Erdoğan described the package as a “radical step” and affirmed that the Government is “determined to make Türkiye a global attraction hub”.

For clients interested in the Türkiye CBI programme or considering tax residency relocation, the final legislation and implementing regulations will determine the actual eligibility scope, particularly regarding: the definition of “tax resident in the past 3 years”, the category of exempt income (dividends, deposit interest, capital gains, salaries, pensions), interaction with double taxation treaties, and the mechanism for registering to participate in the regime.