Taxation of financial leasing transactions

The fact that capital market, banking sector, and financial leasing services could not sufficiently develop in Turkey, together with the high inflation process, in the period after 1980?s, caused the savings to be oriented towards fields with high gaining within short-range. This situation, on the one hand, caused a shortage in the resources for financing the investments and, on the other hand, an increase in the real interest rates due to the increase in the borrowing requirements of the country.The financial leasing, which was started to be implemented with the enforcement of the law 3226 since 1985, is an alternative financial method that the investors can be used instead of meeting the investments from their own resources. In this method, the usage rights of assets are presented to the lease-holder, in exchange for a definite hire rent, for a certain period of time.The aim of introducing financial leasing law is to procure working capital loan to the individuals who cannot generally find working capital loan or to effectuate the modernization of enterprise. Therefore, enabling of full employment and actualizing the economic growth, due to result of increasing the investments, is pursued by the enactment of the aforementioned law.In this study, financial leasing law, which is started to be implemented in Turkey since 1985, and tax legislation, upon which the financial leasing procedures are dependent, are attempted to be evaluated. Thereupon, the changes observed in the tax policies and the effects of these changes on the financial leasing sector, are emphasized in the study.