The government implements various programs to encourage the removal of older vehicles from traffic, and one common method is the so-called scrappage law. This scrappage regulation is issued periodically—typically every three to five years—under varying conditions. The 2018 Scrappage Law was published in the Official Gazette and took effect on March 27, 2018. It remained in force through the end of 2019, offering incentives to owners who retired their older vehicles from circulation. What are the specifics of this law? Who qualifies to benefit and hand over a vehicle as scrap? Answers to these questions and other details are provided below.
2018 Scrappage Law — Overview and Eligibility
The 2018 Scrappage Law came into force in March 2018 and remained valid until the end of 2019. It does not apply to all vehicles; only vehicles aged 16 years or older are eligible. If your vehicle is younger than 16 years, you are not covered by this law. Unlike some previous scrappage programs in which the state purchased scrap vehicles directly, the 2018 regulation does not include direct state purchase. Instead, the state provides an incentive in the form of a reduction in Special Consumption Tax (ÖTV) for those who deliver qualifying vehicles as scrap and then buy a new car. The ÖTV reduction is capped at 10,000 Turkish Lira by law and cannot exceed that amount.
ÖTV Reductions Under the 2018 Scrappage Law
There has been some confusion suggesting that every eligible buyer receives a flat 10,000 TL ÖTV reduction. That is incorrect. The reduction is variable and the maximum possible amount is 10,000 TL. The exact discount depends on the tax-exempt price of the new vehicle, according to a schedule published by the Council of Ministers. The discounts are as follows:
- If the tax-exempt price of the new vehicle is less than 46,000 TL: 10,000 TL ÖTV reduction,
- If the tax-exempt price of the new vehicle is between 46,000 TL and 80,000 TL: 8,000 TL ÖTV reduction,
- If the tax-exempt price of the new vehicle exceeds 80,000 TL: 3,000 TL ÖTV reduction.
These discount levels generated considerable interest among prospective buyers. Although the main points of the 2018 scrappage program are summarized above, many people still asked how to complete the necessary steps. If you own a vehicle that is 16 years old or older and decide to scrap it to take advantage of the incentive, you must first deliver the vehicle to an authorized collection point. Accepted places include metropolitan municipal collection centers, the Machinery and Chemical Industry Institution (Makine Kimya Endüstrisi), or authorized vehicle collection centers. When you hand over the vehicle, you will receive a certificate documenting the delivery.
With that certificate, you then go to the Traffic Registration Office (Trafik Tescil Müdürlüğü) to deregister the vehicle from traffic. After completion you will receive another document confirming deregistration. Present these documents to the dealer when purchasing your new vehicle to claim the ÖTV reduction. The amount of the reduction you receive depends on the tax-exempt price of the new vehicle as described above.
Additional Details of the 2018 Scrappage Law
There are a few additional details to be aware of. If you export your old vehicle instead of delivering it to one of the specified collection centers, you can still qualify for the incentive. You can arrange the export yourself or through a third party, but you must obtain and present the relevant export documentation and then deregister the vehicle at the Traffic Registration Office. The export certificate is issued by the customs authority.
The 2018 scrappage program aims both to remove older vehicles from roads and to stimulate the automotive market. The measure was expected to increase sales of new cars significantly, and experts anticipated secondary effects on the used-car market as well. In turn, this activity was projected to positively impact the broader economy by encouraging vehicle turnover and supporting related sectors.