The ruling Justice and Development Party (AK Party) announced that it is postponing the bill on a proposed tax on credit cards, which would be introduced to boost defense funding amid ongoing regional threats.
AK Party submitted the tax bill to parliament on Friday and after the public opposition, the party announced Tuesday that it was delaying debating the bill until next year.
“There were certain objections from our citizens, we will examine all of this in detail,” said the party’s parliamentary group chairman, Abdullah Güler.
“We have postponed our discussions and we will reconsider, after the budget, if there are some points to change or remove,” he said.
The proposed legislation came as Israel seeks to expand its genocidal attacks in Gaza, with a ground invasion of Lebanon and attacks on Syria, Türkiye’s southern neighbor.
“Our country has no choice but to increase its deterrent power. There’s war in our region right now. We are in a troubled neighborhood,” Finance Minister Mehmet Şimşek told private broadcaster NTV earlier on Tuesday.
The bill stipulated that people with a credit card limit of at least 100,000 liras (nearly $3,000) would have to pay an annual 750 lira ($22) in tax from January to bolster the defense industry.
“If we increase our deterrent power, then our ability to protect against fire in the region will increase,” Şimşek had said, though he added that the bill was in the hands of parliament and that the AK Party, could “re-evaluate” it.
When he proposed the tax on Friday, Güler said that Israel’s next target would be Türkiye, an argument often cited by President Recep Tayyip Erdoğan, who warns that Tel Aviv poses a threat to the region as a whole with its expansionist-Zionist ideology.
A vocal critic of Israel’s offensive in Gaza and Lebanon, Erdoğan doubled down on the threat posed by Israel when addressing a conference on Tuesday.
“Even if there are those who cannot see the danger approaching our country… we see the risk and take all kind of measures,” he said.
Türkiye’s defense industry has enjoyed a boom in recent years but Şimşek said the sector still needed a boost.
The defense industry is planning to invest in 1,000 projects, including an air defense system that would protect Türkiye from missile assaults, Şimşek said.
Türkiye allocated TL 90 billion from the budget to fund the defense industry last year, he added.
“This year, we increased it to 165 billion lira. Maybe we will need to double this even more.”
Türkiyes defense companies signed contracts in 2023 worth a total of $10.2 billion, according to Haluk Görgün, the head of the state Defense Industry Agency (SSB).
The top 10 Turkish defense exporters contributed nearly 80% of total export revenue, he said.
Sales of Baykar drones, used in Karabakh and Ukraine, amounted to $1.8 billion.
Official data from the SSB showed that exports surged 9.8% in value in the first eight months of 2024, reaching more than $3.7 billion.
There are some 126 million credit cards in use in Türkiye, a country of about 85 million people, and some TL 1.25 trillion ($36.48 billion) transactions were made in August, according to Interbank Card Center (BKM) data.
