VAT Exemption on Machinery in Türkiye: 2026 Guide to VAT and Customs Duty Relief

Investment incentives plus port and logistics advantages

The VAT exemption on machinery is the core government support that lets investors in Türkiye expand capacity or modernise their plant with a lighter financing burden. With exchange rates and commodity prices as volatile as they are today, not paying 20% value added tax is a vital cash flow advantage. At FIX we treat it not only as a tax advantage but as a logistics and growth decision. This guide covers the exemptions under the Investment Incentive Certificate and the port and logistics opportunities that come with them.

How does the VAT exemption on machinery work in Türkiye?

Holders of an Investment Incentive Certificate pay no VAT on the domestic or imported machinery and equipment on their approved list. To use the VAT exemption on machinery, a company first needs an incentive certificate from the Ministry of Industry and Technology that matches its line of business and the size of the investment.

The exemption applies at the point of sale: you show the seller the electronic incentive certificate and the machinery list, and the invoice is issued with 0 VAT. There is no paying first and waiting for a refund, so you commit 20% less capital from day one.

Customs duty exemption: the İzmir port example

İzmir, Türkiye’s gateway to the west, plays a strategic role in machinery imports through its Alsancak and Aliağa ports. The Investment Incentive Certificate does more than provide the VAT exemption on machinery: it also gives a customs duty exemption on machinery you import.

For investors importing through İzmir and the wider Aegean region, that means a double advantage:

1. Tax advantage: no customs duty on imported machinery.
2. Logistics advantage: the incentive certificate makes customs clearance easier for machinery arriving at İzmir’s ports and reduces port storage (demurrage) costs.

İzmir’s proximity to industrial centres such as Manisa, Aydın and Denizli makes it an attractive route for machinery imports. Combined with the VAT exemption on machinery, these logistics benefits shorten the investment’s payback period (ROI).

Cost comparison: with and without an Investment Incentive Certificate

The table below shows what the VAT exemption on machinery and the customs duty exemption mean for the total investment budget, using a machinery investment of USD 100,000 as the example.

As the table shows, the VAT exemption on machinery and the customs exemption give the investor a cost advantage of more than 22% before the machinery is even installed.

VAT exemption on machinery: points to watch

Getting the technical details right is what keeps the process on track.

• Machinery list match: the machinery description on the invoice must match the list attached to the incentive certificate word for word.
• HS codes: classifying the customs tariff codes (HS, known in Türkiye as GTİP) correctly matters both at customs and for applying the VAT exemption on machinery.
• Restriction notice: machinery bought VAT-free cannot be sold without Ministry permission until 2 years have passed from the completion visa application, and a restriction is noted on its title or registry record.

FIX tracks the latest VAT communiqués in the Official Gazette, revises investors’ machinery lists accordingly and heads off problems at customs.

Applying online through E-TUYS

To benefit from these exemptions, you apply through E-TUYS, the Electronic Incentive Application and Foreign Capital Information System. The right to the VAT exemption on machinery is activated by the Incentive Certificate ID issued in the system. Once your company authorises us as its consultant in E-TUYS, we handle every step online, so there is no need to travel to Ankara.

A single machinery code entered wrongly can cost you the VAT exemption on machinery or leave your goods held at customs. That is why the process needs professional management.

Conclusion: earn from production, not from tax

Whether you are building a technology hub or a food plant anywhere in Türkiye, the VAT exemption on machinery is your investment’s lifeblood. Together with the customs duty exemption and strong port logistics, it sharpens your edge in global competition. To use these rights fully and on time, without getting caught in red tape, you need the right partner; that choice matters as much as the investment itself.

How FIX helps: FIX supports investments across Türkiye. Our team runs VAT exemption applications for machinery, customs exemption procedures, E-TUYS follow-up and machinery list revisions.

To lighten your tax burden and make full use of the incentives available, visit our Services page or get in touch.