Annual inflation nears double digits in Turkey amid hikes in taxes, food prices

The inflation rate in Turkey rose by 1.82 percent in January, triggered by persistently high food costs and tax hikes, especially on alcoholic beverages and tobacco products, lifting the annual inflation rate to 9.58 percent, close to double digit levels and the highest since May 2014.  

According to data released by the Turkish Statistics Agency (TÜ?K), the highest monthly increase was 9.6 percent in alcoholic beverages and tobacco products in January. The indices rose for food and non-alcoholic beverages by 4.28 percent, for miscellaneous goods and services by 2.71 percent, for health by 2.42 percent and for recreation and culture by 2.09 percent.

The only monthly fall was in clothing and footwear with 6.71 percent, according to the data revealed on Feb. 3. 

The government increased special taxes on cigarettes and alcoholic drinks at the beginning of the year.
 
The minimum fixed-tax rate on tobacco products was increased by 5.1 percent to 4.42 Turkish Liras and the fixed rate by 25 percent to 0.25 liras to mark the New Year. The minimum fixed-tax rate for beer was increased by 0.18 liras to 1.03 liras. The minimum fixed-tax rate for two liters of rak? was increased by 23 liras to 130.68 liras. 

Electricity prices were also increased by 6.8 percent as of Jan. 1. 

Finance Minister Naci A?bal said the rising tobacco, alcoholic drinks and food prices, as well as the recent increase in the minimum wage, have pushed up the inflation rate in a televised interview on Feb. 3. 

"We hope to decrease the inflation rate in 2016 through a number of measures," he noted on Turkish channel A Haber. 

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