Daily Tax Report ®

Turkey’s Hedge Funds Are Latest Casualties of Currency Clampdown

June 3, 2020, 11:12 AM

Turkey will no longer allow investors to set up hedge funds that invest primarily in foreign-exchange assets and will start taxing existing ones, the latest measures designed to clamp down on local demand for hard currency.

The Capital Markets Board said it has suspended approvals for funds whose foreign exchange-denominated securities make up at least 80% of total holdings. The government will impose a 15% tax on the management of such funds, according a presidential decree.

At roughly $3 billion, the size of the funds affected by Wednesday’s measures is relatively small, especially when compared to the $195.7 billion of...

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