Turkey to Cut Value-Added Tax on Staple Foods

Turkey will slash the value-added tax on staple food from 8% to 1% in a bid to curb inflation, President Recep Tayyip Erdogan said at a virtual news conference, Bloomberg reported. Finance Minister Nureddin Nebati said that the Turkish government will create a task force to look at prices and a mobile app to help citizens find the cheapest goods in other efforts to fight high prices. Nebati also said the government will implement a new Credit Guarantee Fund package that will guarantee up to 60 billion liras, or $4.45 billion, allowing banks to dole out much more, Bloomberg said. So far, the Turkish central bank has cut interest rates by 500 basis points in four meetings since September, Bloomberg said. Turkey also recently authorized its agriculture ministry to restrict ag exports in an effort to control domestic food price inflation (see 2202020032).