Tax expenditures and evaluation of the tax expenditures in Turkish income tax in terms of the budget realizations

Tax expenditures that refer to elements deviating from the standard tax structure like applications such as exception, exemption, tax rates with discount, reduction, setoff, tax credits etc. are accepted as indirect transfer expenses. Negative effect of the tax expenditures, which are out of the budget and therefore are not subject to budget inspection, to the transparency and accountability of public financial management brought out the necessity of including these expenditures in budget processes. In this framework, practices on determining tax expenditures have started in the countries with developed economies especially in Federal Germany at the end of 1950s and in United States of America and European countries later on. Practices on tax expenditures in Turkey have started in the framework of the 8th Development Plan. The first tax expenditures report has been published in 2001, and after that another study called Tax expenditures Report has been published in 2007. Besides, starting from the 2006 fiscal year within the law issued 5018, lists that include tax expenditures estimations have being added to the Central Administration Budget Act. In Turkey, the comparison of tax expenditures estimations within the scope of income tax with the collected income tax amount as well as the comparison of total tax expense estimations with the central administration budget costs provides important data about both the income tax practice and the extend of tax expenditures as expenses out of budget. Besides, excluding similar regulations existing in the tax legislation of the lists except estimations of tax expenditures added to budget as in lists comes first in the topics which are to be made criticism subjects. Apart from this, any works' not being made of by corporations related to budget about realization of the mentioned estimated expenses can be accepted as another element to be criticized.