With 100% tax deductions and 95% income tax exemptions for researchers, Türkiye cements its status as a global R&D powerhouse in 2026.
Türkiye has successfully transitioned from being “Europe’s factory” to becoming one of its most vital “innovation labs.” As of early 2026, the nation hosts over 1,600 government-certified R&D and Design Centers, a growth fueled by some of the most generous fiscal incentives for research and development globally. Under Law No. 5746, any company that employs at least 15 full-time equivalent R&D personnel (or 10 for design activities) can transform their innovation department into a massive tax-saving engine.
The primary fiscal benefit is the 100% R&D Deduction, which allows companies to subtract their entire R&D expenditure from their corporate tax base. In an era where high-tech competition requires constant reinvestment, this incentive effectively allows firms to fund their future innovations using capital that would otherwise be paid in taxes. This is further bolstered by a 95% income tax withholding exemption for researchers with a PhD and 90% for those with a Master’s degree, ensuring that the highest levels of academic and engineering talent are affordable for the private sector.
The 2025-2026 regulatory updates have also introduced a cap on tax withholding incentives to “forty times the gross minimum wage,” ensuring the system remains sustainable while still providing massive relief for high-salaried engineering teams. Beyond payroll, R&D centers enjoy a 100% exemption from VAT and Customs Duty for any machinery, equipment, or software imported specifically for research projects. The government also provides Social Security Premium Support (50%) for all eligible R&D personnel, further lowering the operational cost of maintaining a high-tech workforce.
For multinational corporations, Türkiye’s R&D ecosystem offers a “Dual Advantage”: world-class engineering talent at a competitive cost, backed by 100% state support. Global giants like Ford, Siemens, and Huawei are already leveraging these centers to design products for the global market. As the world pivots toward AI, green hydrogen, and biotechnological medicine, Türkiye’s R&D centers are the frontline where the products of tomorrow are being developed today—subsidized by a state committed to technological self-sufficiency.
Citations & Sources:
- Legislative Data: CottGroup – Drafts Regarding R&D Income Tax Incentives 2025/2026
- OECD Analysis: STIP Compass – Law No: 5746 Incentives for R&D
- Ministry Statistics: Ministry of Industry and Technology – R&D and Design Centers List
