FX.co ★ Turkey Budget Deficit Narrows in December

In December 2025, Turkey’s central government successfully reduced its budget deficit to TRY 528.1 billion, a significant reduction from TRY 830.8 billion seen in the same period the previous year. The budget's financial health was bolstered by a notable 43.7% increase in revenue, totaling TRY 1.26 trillion. This upward trend was largely attributed to a 47.9% surge in tax revenue, reaching TRY 1.05 trillion. The strong tax performance was mainly driven by substantial increases in income tax, domestic VAT, special consumption tax, and taxes from banking and insurance transactions.

On the expenditure side, total spending climbed by 4.8% to TRY 1.79 trillion. This was due to a 2.5% increase in non-interest expenditures, which amounted to TRY 1.68 trillion, and a significant 55% rise in interest payments, reaching TRY 116.7 billion. The expansion in spending was widespread, with notable rises in personnel costs, current transfers, and capital expenditures compared to December 2024.

The primary budget deficit showed a marked improvement, decreasing to TRY 411.5 billion from TRY 755.6 billion the previous year, highlighting better revenue collection and effective management of non-interest spending.