Five pro-gov't construction companies granted tax incentives 128 times in last decade

The Turkish government has granted the construction companies of Cengiz, Kalyon, Limak, Kolin and Makyol tax incentives and exemptions 128 times in the last decade, Trade Minister Ruhsar Pekcan said in her answer to a parliamentary question filed by the main opposition CHP.

Duvar English

The construction companies of Cengiz, Kalyon, Limak, Kolin and Makyol, which are known to have close ties to the government, have been granted tax deductions 128 times in the last decade, the government said, in response to a parliamentary question filed by main opposition Republican People's Party (CHP).

The question was addressed by CHP deputy Ali Mahir Başarır to Trade Minister Ruhsar Pekcan, online news outlet T24 reported on Dec. 24.

The minister said in her answer that Cengiz Construction benefitted from the tax incentive called “Certificate of Exemption from Taxes, Duties and Charges” (in Turkish VRHİB) 30 times, Kolin Construction 36 times, Makyol Construction 24 times, Kalyon Construction 19 times and Limak Construction 19 times.

In order to give exported products competitive power in international markets, the government exempts certain firms from contract stamp tax and decision stamps within the scope of VRHİB.

CHP MP Başarır pointed out that for a firm to be granted this tax incentive, a foreign firm needs to give an offer price for the relevant export good during a tender process. “I will personally follow up this issue to determine which foreign firms participated in these 128 tender processes,” Başarır said.

The CHP MP also said that every kind of “concession” granted to companies with close ties to the ruling Justice and Development Party (CHP) “hurts the public's conscience.”

Earlier in December, CHP chair Kemal Kılıçdaroğlu promised to nationalize pro-government companies' investments, referring to the aforementioned five firms as “a gang of five.”

"We'll nationalize and seize all the investments of this gang of five that will exploit even our grandchildren," Kılıçdaroğlu said on Dec. 7, as he also vowed to end "this order of theft."

Turkey’s private-public partnership (PPP) system has been used to fund megaprojects that include bridges, ports, roads and airports.

The system turned into a way of giving out handouts to the companies close to President Recep Tayyip Erdoğan's ruling AKP.

It allows private companies granted tender on the projects to make an initial investment and construct the infrastructure, after which they are granted the license to operate it for periods often reaching decades.