Following its scrutiny of those with high expenditures but no income declarations, the Treasury and Finance Ministry’s Tax Inspection Board (VDK) is now tracking taxpayers who drive luxury vehicles despite not declaring any income, according to a report on Monday.
According to information obtained by an Anadolu Agency (AA) correspondent from the ministry, the VDK is focusing on taxpayers who do not declare taxes in line with their expenditures. This comes in line with the message and directive of Treasury and Finance Minister Mehmet Şimşek who pledged to increase fairness and efficiency in taxation.
Consequently, tax inspectors have reportedly started investigating how individuals who own luxury vehicles acquired these vehicles and whether they have declared this income.
In studies conducted on 7,885 luxury segment vehicles, it was found that taxpayers who did not declare income or company partnership, or whose companies did not distribute profits despite having partnerships, were identified. These luxury vehicles were found to be models from 2022, 2023 and 2024, including Porsche, Bentley, Ferrari, Lotus, Maserati, Mercedes (Maybach, G, S) and BMW (740, I7).
In these investigations, taxpayers who acquired luxury vehicles with unrecorded income will be the primary target group.
In the examinations, it was determined that approximately 3,000 vehicles were registered to real persons, 2,000 of whom were partners in 7,000 companies, and among these, only 300 companies distributed profits in 2022 and 2023.
On the other hand, it was found that 780 of the examined vehicles were registered to individuals who are not taxpayers, and these individuals have no income source.
Only 150 of the luxury vehicle owners were found to have an income tax liability, and among these, 100 had profits below TL 1 million ($30,290), as per the AA report.
In the examinations, priority is given to those who are not taxpayers, who do not have a partnership in a company and who do not have any other income declarations. Subsequently, work will be done on taxpayers who have company partnerships but do not distribute profits or declare other income.
In this context, 500 vehicle owners have been referred for tax inspection to determine if this situation, which is inconsistent with their income, is related to unrecorded earnings.
The VDK is also said to have encountered noteworthy examples during its inspections.
For instance, it was found that company owners bought Mercedes cars worth up to TL 23 million in 2023, but their companies only had a few million Turkish liras in profits over the last two periods and did not distribute profits. Checks revealed that the vehicle costs were sent from the companies’ bank accounts but were not reflected in the records.
In another example, individuals who did not declare any income and had no partnerships were found to have purchased a Bentley vehicle for TL 27 million in 2023.
Tax inspectors will determine the income source used to acquire these luxury vehicles and ensure that this income is taxed. For those for whom no legal source can be identified, a money laundering investigation will also be conducted.
Moreover, the Ministry of Treasury and Finance would expand and continue these initial inspections based on new findings from the risk analysis units.
The Turkish Parliament approved last week a tax package that envisions strengthening tax efficiency and fairness as authorities move on with stricter policy amid tight monetary policy to rein in inflation.
Also, with this package, tax penalties will be increased, some exemptions will be abolished, and the informal economy will be fought more vigorously, the ministry said on Sunday.
