The Turkish government is set to override the concerns of the International Monetary Fund (IMF) and cut value-added tax on textile products by 10%, according to reports.
Foreign trade minister Kursad Tuzmen told reporters that the cut from 18% to 8% was necessary to protect Turkish textiles manufacturers from a flood of cheap Chinese products in global markets.
Thousands of jobs are at risk thanks to rising energy costs and increasing competition from China, manufacturers say. Global textile quotas were abolished last year.
The government has previously said such a cut was possible, but the IMF argued that it would cost the government TRY1bn (US$767m) in lost revenues, threatening budgetary targets. Tuzmen said there was ?o question?of a loss in tax income.
