Dervis strongly dismisses fellow minister’s call for 2002 tax breaks

ANKARA (Reuters) – Turkish Economy Minister Kemal Dervis yesterday rebuffed a fellow-Cabinet minister, ruling out giving any of the tax breaks for industry this year that his ally had called for to stimulate growth. «Any cuts in VAT or other taxes, even on a temporary or seasonal basis, are out of the question in 2002,» Dervis said. «This is among the undertakings of our 2002 (IMF-backed) economic program,» he said after remarks by Foreign Trade Minister Tunca Toskay, of the nationalist wing of the coalition government, that some industrial sectors needed tax help to stimulate growth. «Micro solutions must be pursued in micro taxation to revitalize some sectors in a way that does not threaten program targets for the primary (budget) surplus,» said Toskay of the Nationalist Action Party, which has created tension before by its reluctance to endorse IMF-backed reforms. Dervis said there was no room for such cuts, although he hinted a planned reform of the tax system might allow leeway in 2003.