Going green: recycling contribution fees start in 2020

In detail

The use of fiscal policy instruments to drive green behaviour continues to grow throughout the world. Turkey is no exception. On 10 December 2018 the Turkish Environmental Law was amended to introduce a number of measures in a push to reduce waste and increase the rate of recycling in the country.

As part of these measures, a ban on the free distribution of plastic bags was implemented in January 2019, in a bid to curb plastic pollution. Under the new rules, stores are required to charge 0.25 Turkish lira for every single-use plastic bag they provide to their customers.

The measures also included the introduction of a recycling contribution fee (GEKAP) on goods that are harmful to the environment if not recycled.

The fee covers plastic bags, tyres, batteries, certain electrical and electronic appliances, oils, medicine and packaging materials (plastic, metal, composite, glass, wooden), albeit the implementation in 2019 remained limited with plastic bags only.

With the regulation published on 31 December 2019, the recycling contribution fees- implemented only for plastic bags up until that date-, will also be implemented for the rest of the in-scope goods, effective from 01 January 2020.

Lastly, on 5 February 2020 Communiqué No. 2 on Recycling Contribution Fees was issued to provide further implementation details. Below is an overview of how the new levy will work.    

Goods subject to recycling contribution fees  

The recycling contribution fee applies to the goods stated in the list (1) attached to the Environmental Law. The full list, together with the applicable fees, can be found at the end of our bulletin.

The recycling contribution fee applies if these goods are supplied to the Turkish market. The fee does not apply to exports. 

Who is responsible for reporting and payment?

The responsibility to report and pay the recycling fee belongs to the party supplying the product to the Turkish market (importer or manufacturer).

However, for plastic bags and only for plastic bags, the recycling fee is reported and paid by the party that delivers products to consumers. (i.e. stores)

Reporting and payment timing

Reporting and payment are carried out on a monthly basis for corporate taxpayers. (quarterly basis for others.)

As per the amendment made by the Communiqué No.2, the fees must be reported and paid by the last day of the month following supply of the product to the market.  (following delivery to the consumer in the case of plastic bags)

As the regulation took effect on 1 January 2020, the first reporting and payment (for goods other than plastic bags, for which implementation began in 2019) shall be made by the last day of February 2020.  

Offsetting possibility for returned goods

Recycling contribution fees for returned goods can be offset from the total recycling contribution liability to be paid.  

If the amount to be offset is greater than the recycling fee payable, the excess portion will be carried over- as a credit- to the following periods.

Offsetting is disallowed for  plastic bags.

What if a dutiable good is supplied to the market inside a non-dutiable good?  

This matter was unclear before Communiqué no.2 was published in February 2020. The examples provided in Communiqué No.2 clarified the situation:

If a good which is not on the List(1) of the Environment Law includes parts that are on the List (for example tyres, accumulators or electronic devices in a motor vehicle) the party supplying the non-dutiable good (the motor vehicle) to the market is responsible for reporting the recycling fee, but will not be asked to make any payment.

Administrative Penalties

In the inspections to be carried out by the Ministry of Environment and Urbanisation;

• If it is detected that recycling contribution fee was not reported on time or fully, the regulation imposes an
• administrative fine which is set as TRY 22.109 in 2020.
• Failure to pay the recycling fee, on the other hand, is subject to a penalty of 120% of the amount due. 

The penalties are doubled if incompliance is repeated within three years. After the second failure, for any further failure in the same three-year interval, the penalty is tripled.

Deposit refund scheme

Recycling contribution fee shall not apply to the goods whereby depository scheme is implemented.

Appendix: The list of goods subject to recycling contribution fees: