Istanbul residents flocked to the city's parks and beaches on the first weekend since the coronavirus lockdown lifted, prompting a reprimand from the country's health minister who warned that the Covid-19 pandemic still poses a threat.
Images shared on social media and in the news showed crowds picnicking and partying on Saturday night with little regard for social distancing guidelines or the requirement to wear masks.
Health Minister Fahrettin Koca tweeted "let's not normalise too much", urging people to wear masks and keep their distance.
Restaurants, cafes, gyms, parks, beaches and museums began reopening on Monday in Turkey and domestic flights resumed.
A decision by the Interior Ministry to continue a weekend curfew in 15 provinces, including Istanbul, was overturned on Friday by President Recep Tayyip Erdogan with a series of tweets.
Mr Erdogan said he was reversing the decision on the grounds that it would "lead to different social and economic consequences."
Turkey has confirmed 4,669 deaths from Covid-19 and 169,218 cases since the first infections were reported in the country on March 11.
The virus spread rapidly through all 81 provinces of the country, which looked set to be one of the worst-hit in the world.
However strict restrictions helped contain the spread of the pandemic, including sealing off major cities and implementing weekend curfews.
In late May, Turkish authorities declared “mission accomplished” against the virus, saying investment in the healthcare system, free treatment and a science-led approach had contained the outbreak.
Last month, the opening of two new hospitals for coronavirus patients in Istanbul coincided with a decline in the number of new cases.
Turkish President Recep Tayyip Erdogan, who has described the pandemic as the “biggest crisis since the Second World War in terms of the economic impact,” cancelled plans last week to reimpose lockdowns in major cities to avoid further damage to the economy.
Mr Erdogan scrapped the proposal even after the number of coronavirus cases jumped by almost 1,000 on Thursday, compared with about 700 in previous days. His announcement came about 12 hours after the Interior Ministry unexpectedly announced curfews would resume in Istanbul, Ankara and 13 other municipalities last weekend.
“It has been understood that the decision would lead to some social and economic consequences,” Mr Erdogan said in a Twitter post last Friday.
The International Monetary Fund forecasts Turkey’s economy may shrink 5 per cent this year as a result of measures taken to contain the spread of the pandemic.
As the restrictions ease, people aged 65 and older and minors are still barred from leaving their homes except for at allotted times during the week.
Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer
'Unrivaled: Why America Will Remain the World’s Sole Superpower'
Michael Beckley, Cornell Press
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