KTTO Condemns VAT Increases on Essential Goods and Services

In a written statement, KTTO declared, “The government’s VAT increase on essential consumer products like food and cleaning supplies, as well as on the service sector, is unacceptable and must be rescinded immediately.”

The statement emphasized that rather than increasing purchasing power, the government is burdening households and businesses, which is "economically irrational."

“Businesses can no longer endure the rising costs they face daily. This new VAT increase by the government has only added insult to injury. Is this how the government plans to reduce the cost of living? Is this how it aims to ensure business sustainability? Is this how it intends to protect household purchasing power?” the statement asked, adding that the measures signal a challenging year ahead for businesses and workers in 2025.

The KTTO criticized the government for resorting to taxing the public to finance itself, describing it as an unacceptable approach to inflation. The chamber accused the government of targeting even the basic needs of low-income families by increasing VAT rates.

Highlighting the impact of the VAT hikes, the statement said:
“Raising VAT rates on basic food items to 5% and 10% will make not only living but also proper nutrition nearly impossible. Governments should focus on finding ways to increase the income of the country, businesses, and workers at least in line with inflation.

Protecting our people from rising costs can only be achieved this way. Unfortunately, the government has made no effort in this regard. On the contrary, it continues to burden thriving sectors with new costs, deter investments, and effectively dismantle the economy with its own hands.”