Erdogan to Forgive Debt of Turks in Pre-Election Voter Giveaway

Firat Kozok and Beril Akman
·1 min read
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(Bloomberg) -- Turkish President Recep Tayyip Erdogan said his ruling AK Party will propose a bill to relieve the debt burden of millions of people, a move aimed at strengthening his voter base ahead of this year’s elections.

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“We are forgiving debt not exceeding 2,000 liras ($106), predating to Dec. 31, 2022, owed to tax offices,” Erdogan said in a televised address after a cabinet meeting Monday. He said the bill would extend to some traffic penalties and fines owed to public institutions.

The proposal on debt relief could be the president’s costliest pre-election giveaway yet, as he makes sure government support for struggling Turks continues through to the vote slated for May. The country has been battling one of the world’s biggest inflation crises, with price rises peaking at above 85% before falling to 64% at the end of last year.

Read more: Erdogan Readies Debt Relief for Millions as Election Approaches

Turkey has already increased the minimum wage for this year by 55% and promised early retirement to over 2 million employees, a decision expected to cost the government some $13 billion. Pensions and civil-servant wages have meanwhile been raised by 30% and may see an interim hike in July. The government is also backing affordable housing projects, expected to cost the Treasury billions of liras.

Read more: Tiniest Turkish Deficit Since 2011 Sets Stage for Budget Splurge

While Erdogan remains Turkey’s most popular politician, his party has lost support among the poor, who’ve typically been among its most stalwart backers.

Turkey already provided almost $16 billion of tax relief last year, according to Treasury and Finance Minister Nureddin Nebati.

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