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Türkiye's Digital Services Tax was introduced by Law No. 7194 (2019), with the tax entering force on 1 March 2020 at a statutory rate of 7.5% on the gross Turkish-sourced revenue of digital-service providers whose worldwide revenue exceeds €750 million and Turkish revenue exceeds ₺20 million (thresholds set in the enabling law). Article 5(3) of the law grants the President authority to adjust the rate between 1% and 15% by decree, without further legislative action.
Presidential Decision No. 10767 exercises that delegated authority to cut the rate in two steps: to 5% for revenue earned from 1 January 2026, and to 2.5% for revenue earned from 1 January 2027. The decision was published in the Official Gazette (Resmî Gazete, Issue No. 33118) on 25 December 2025 and takes effect for revenue generated from 1 January 2026 onward. No sunset or reversion clause is specified — the two-step schedule is the terminal rate structure unless further amended.
The DST falls overwhelmingly on large non-resident digital platforms (search/display advertising, social media, video/content platforms, online marketplaces and intermediary services) rather than on domestic Turkish firms, since the €750m global-revenue threshold excludes almost all local operators. It has been a recurring irritant in US-Türkiye trade relations, paralleling the US Section 301 DST disputes with France, India, the UK, Italy, Spain, Austria and others — all of which committed under the October 2021 OECD/G20 Inclusive Framework political agreement to remove unilateral DSTs once Pillar 1 Amount A enters into force, and to freeze/roll back rates in the interim ("Vienna compromise" standstill).
Canada's 2025 DST rescission, this is another unilateral-DST jurisdiction stepping down its rate in the absence of Pillar 1 Amount A entering into force — the multilateral replacement it was originally meant to bridge to has still not materialized.
DST receipts (rate cut of a third in 2026, and two-thirds by 2027) in exchange for reduced exposure to US Section 301-style retaliation risk on a tax that primarily burdens US platform companies.
repeal), Türkiye has chosen a phased-reduction path that leaves the DST mechanism itself intact at a residual 2.5% from 2027, preserving the option to re-raise the rate by future decree without new legislation.
USTR, or is it a unilateral Turkish fiscal decision ahead of an anticipated Pillar 1 milestone?
pattern, or hold the residual 2.5% rate indefinitely?
the fiscal cost of the two-step cut?