New year, new prices

It’s rather sneaky to announce tax rises on the day before they come into effect, as the Turkish government did on the last day of 2009. The rises are not small: petrol prices, already high in Turkey, went up by about 20 kuruş to 3,63 per litre (€1,70). The tax on cigarettes went op from 58% to 63% (I support that one), the fixed tax on wine and rakı goes up by 1,15 lira and 3,90 lira respectively, on beer from 26 kuruş to 35 kuruş (I don’t support that one). Passports: up 10%. Toll for bridges and roads: up 14%. The smallest rise is in the price of electricity: up 1,3 percent – but that one affects every Turk, even the poorest.

Also raised was the minimum wage, up by 5,2%, making it 577 lira (€269) per month. Impossible to live on, especially if you have, for example, an average family of five. Later this year it will go up again by a bit more than 4%, but overall it doesn’t even keep up with inflation, so in the end, people’s incomes go down.

The government says the price increases are needed to reduce its budget deficit, and they have raised prices of goods with a ‘low price elasticity’. Meaning people won’t change their driving, smoking and drinking habits too much when prices go up, so the profits for the government are huge. So let’s go on drinking, smoking and driving as if nothing has changed, and thus lend a helping hand to the government. Then maybe next year they can start making some policies on urgent matters, like youth unemployment, improving education and better health care. Happy new year!

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