TCMA 2020 ANNUAL REPORT

Turkey and our Association, and that the annual minimum fee tariff so determined by the CMB would be published in the Official Gazette. The Association submitted to the CMB its opinions and suggestions compiled based on the opinions and suggestions conveyed by our members in relation to the “Draft 2021 Real Estate Appraisal Minimum Fee Tariff and Implementation Principles”, which incorporates increases at varying rates and was reviewed by CMB for enforcement in 2021, in line with the needs and demands of the sector. Taxation Regulations Concerning our Sector The Law envisaging restructuring of certain public receivables, declaration of assets at home and abroad for their entry into records, and amendments to various tax laws was published in the Official Gazette issue 31307 dated 17 November 2020. Our Association represented our sector during the negotiation of the bill by the Grand National Assembly of Turkey Committee on Plan and Budget; taxation arrangements concerning our sector within the scope of the Law no. 7256 regarding Restructuring of Certain Receivables and Amending Certain Laws” are summarized below: Corporate Tax incentive companies that will carry out an IPO at Borsa İstanbul It has been stipulated that a corporate tax rate reduced by 2 points will be applied to corporate earnings of companies offering at least 20% of their shares at the initial public offering on Borsa İstanbul Equity Market for 5 fiscal years starting from the fiscal the IPO takes place in. Banks, leasing companies, factoring companies, finance companies, payment and electronic money institutions, authorized FX firms, asset management companies, capital market institutions, and insurance, reinsurance and pension companies are excluded from this practice. This arrangement entered into force on its publication date, applicable from 1 January 2021, and from the start of the special fiscal period starting in 2021 calendar year for taxpayers subject to special fiscal period. Extending the validity of Provisional Article 67 of the Income Tax Law until 31 December 2025, and inclusion of revenues derived on leveraged trading transactions within the scope of withholding The validity of the Provisional Article 67 of the Tax Income Law was extended until 31 December 2025 and the President has been authorized to further extend this period up to five years. The said article covers provisions regarding the taxation of the yields on the disposal and retention of securities and other capital market instruments, interests earned on deposit accounts, repo income, and income derived on participation shares paid in return for participation accounts. An additional provision was inserted within the scope of Provisional Article 67, stipulating taxation through withholding at source of the earnings derived on leverage trading (forex) transactions executed via banks and intermediary institutions (applicable to earnings derived from 1 January 2021 onwards). Extended applicability for rule that certain revenues derived by associations or foundations will not constitute economic enterprise The term of the rule that economic enterprise will not be deemed to have been constituted by reason of the revenues and income subjected to withholding tax under Article 94(5) and Provisional Article 67 of the Income Tax Law derived by associations or foundations as mentioned in the first paragraph of Provisional Article 2 of the Corporate Tax Law no. 5520 was extended from 31 December 2020 until 31 December 2025. Payments by equity companies to shareholders through capital decrease be deemed dividend distribution and be subjected to 15% withholding tax The paragraph inserted in Article 94 of the Income Tax Law set out as follows: In the event that full-fledge taxpayer equity companies buy back their own share certificates or shareholding interests under the provisions of the Turkish Commercial Code, they will be deemed as dividend distribution and be subjected to 15% withholding tax; • If redeemed through capital decrease; based on the difference between the acquisition price and the nominal value of share certificates or shareholding interests, on the date the capital decrease decision is registered with the trade registry, • If disposed of at a price below the acquisition price; based on the difference between the acquisition price and the disposal price, on the date of disposal, • If not redeemed through capital decrease or not disposed of within two full years following the date of acquisition; based on the difference between the acquisition price and the nominal value of share certificates or shareholding interests, on the final day of the two full year-period from the acquisition date. TCMA 2020 ANNUAL REPORT 33