US-Turkish citizens hit with sticker shock over new tax law
Turks with US citizenship making profits from the stock market and interest in Turkey are now liable for taxes going back six years.
During the US economic crisis at the end of 2008 that affected the entire world, many countries including Turkey took measures to protect their stock markets.
Turkey's Council of Ministers abolished the 10% tax on income from stock shares with decisions on Oct. 27, 2008, and Sept. 30, 2010, preventing the stock market from crashing. After a rough 2008, the market quickly recovered. Those who bought stock during the crisis and risked investing in long-term equities made tremendous profits.
The Borsa Istanbul 100 Index (the Istanbul Stock Market), which had fallen to 26,864 on Dec. 31, 2008, rose to 52,825 at the end of 2009 and 66,000 by the end of 2010, a 146% growth. That is, each $100 invested in Turkish market at the end of 2008 was worth $246 after two years. This spectacular increase will be hard to match.
Now there is nasty surprise in store for Turkish-origin US citizens who bought shares in Borsa Istanbul after July 1, 2008, and made money.
