Turkey increases municipal street lighting expense deductions

A new Presidential Decree published in the Official Gazette has significantly increased the deduction rates for street lighting expenses from municipal general budget tax revenue shares. The regulation, which is set to take effect on January 1, 2026, triples the previous deduction rates.

Under the new system, the deduction rate for metropolitan municipalities and those within their contiguous areas will rise from 20 percent to 60 percent. For other municipalities, the rate will increase from 10 percent to 30 percent. For areas outside these boundaries, the deduction from special provincial administration shares will also rise from 20 percent to 60 percent.

In İzmir, the decision will impact the Metropolitan Municipality as well as 30 district municipalities, including Konak, Karşıyaka, Bornova, Buca, Bayraklı, Karabağlar, and Çiğli. The reduction in available funds is expected to pressure local governments, potentially affecting budgets for personnel, transportation, infrastructure, and social services, forcing municipalities to reprioritize ongoing and new projects.