Türkiye Approves Law to Halt Inflation Accounting for 3 Years

On Wednesday, the Turkish Parliament passed a law removing the requirement for companies to produce inflation-adjusted accounts for the 2025, 2026, and 2027 financial years.

Countries sometimes employ inflation accounting methods to help provide a clearer picture of economic conditions during periods of high inflation, The Caspian Post reports, citing Turkish media.

Türkiye decided in 2023 to introduce such measures from the end of 2023 to 2026. That came after Turkish inflation soared to 85% in late 2022.

The authorities then decided to adopt more conventional economic policies in the middle of 2023, following the elections, and since then, they have focused on disinflation and price stability.

According to the regulation adopted by Parliament on Wednesday, Turkish companies' accounts will not be subject to inflation adjustment for the 2025, 2026 and 2027 financial years. The regulation also gives the president the authority to extend this period for another three years.

The Banking Regulation and Supervision Agency (BDDK) watchdog said this week it had decided that banks, financial leasing, factoring, financing, savings financing and asset management companies would not apply inflation accounting.

The annual inflation rate in the country was 31.07% in November, the lowest in four years.