KAYSO President Buyuksimitci stated, “Inflation accounting will bring additional burden to our companies.”

Mehmet Büyüksimitci, the Chairman of the Board of Directors of Kayseri Chamber of Commerce (KAYSO), made a statement regarding the inflation accounting that is desired to be implemented, saying, “The inflation accounting to be implemented in 2024 will bring additional burdens to our companies.”

In his statement, President Büyüksimitci said, “Inflation accounting will bring many negative consequences on both macro and micro scales. It will particularly create unfair taxation for our real sector and industrialists and adversely affect companies. The valuation of the active assets in the balance sheets of inactive businesses results in the taxation of these businesses that do not generate income. Even companies that have no commercial activity will face a tax burden. Additionally, for businesses that have insufficient equity and a high debt-to-equity ratio, inflation adjustment will increase the tax burden, leading to a rise in their financing needs. Companies with strong equity structures will not pay taxes on their profits from core activities due to inflation adjustment losses, while firms with weak equity structures, financing their active elements through debt from the financial sector or partners, will face additional tax payments as a result of inflation adjustment profits. There is a possibility that while we lose tax revenue from profitable firms due to their strong equity, we may also encounter a situation where additional taxes are collected from loss-making firms due to the income effect of inflation adjustment on losses. Rising prices due to inflation make our businesses appear profitable, but these are profits that do not actually exist and only appear on paper. Not to mention making a profit, you cannot even replace your goods at the price you sold them. Instead of making a profit, the capital of our companies continues to erode day by day,” he stated.

Büyüksimitci said, “While our businesses are trying to survive against high costs, high-interest rates, and difficulties in accessing financing, it is necessary to evaluate the effects of the decisions taken on the real sector. Steps taken within the scope of the anti-inflation program should not disrupt production and employment. We should not punish our firms by confronting them with a tax burden based on nonexistent profits. This situation will have a negative impact on the economy as a whole. Considering the difficult conditions our businesses are in, we expect this issue to be re-evaluated in a way that will relieve our industrialists, without additional tax burdens, and with the opinions of the business world taken into account.”