Turkey to implement phased diesel tax increases through year-end

Turkey is implementing a phased increase in Special Consumption Tax (ÖTV) on diesel fuel, which is expected to significantly impact both the agricultural sector and consumer goods prices. While the tax was temporarily zeroed out through the end of August, it will return incrementally: 3 lira per liter in September, 6 lira in October, 9 lira in November, and 12 lira in December.

Farmers face particular challenges as the tax hikes coincide with the peak period for tractor usage during harvesting and sowing seasons. Increased fuel costs for tractors and combines are expected to raise production costs for staples such as wheat, corn, and various vegetables, ultimately driving up food prices for consumers.

Beyond agriculture, the rising cost of diesel affects logistics and transportation. Increased fuel expenses for trucks, buses, and cargo vehicles are likely to be passed down through the supply chain, impacting market and grocery prices. Additionally, the removal of the equalization mobile system means that fluctuations in oil prices and exchange rates will no longer be buffered by tax adjustments, leaving consumers more vulnerable to market volatility.