The Turkish Parliament approved a new law proposal aimed at creating the disaster reconstruction fund late Wednesday. The fund will oversee the allocation of resources for the restoration of infrastructure and superstructures in areas affected by various natural disasters such as earthquakes, floods, fires and landslides in regions that have been classified as "disaster zones."
The Treasury and Finance Ministry will monitor the law and provide financial data to the public on a quarterly basis.
This new law aims to provide a coordinated and efficient response to natural catastrophes by ensuring that resources are allocated effectively to the affected regions.
The board of directors for the disaster reconstruction fund is to be chaired by the treasury and finance minister and will comprise the minister of environment, urbanization and climate change, the minister of energy and natural resources, the minister of agriculture and forestry, the minister of interior, the minister of transport and infrastructure and the head of strategy and budget.
The board of directors will determine the projects to be transferred from the fund, the number of resources to be transferred and the execution of expenditure programs. The principles and procedures regarding the structure and operation of the fund will be determined by the regulation.
The fund will draw on a variety of resources to achieve its goals, including domestic and international cash donations, aid, grants and loans. In addition, there will be an appropriation placed in the budget specifically for this purpose. The financing and resources will be generated from domestic and foreign capital and money markets and will be exempt from any restrictions imposed by institutions and organizations.
The board of directors will decide which projects to fund based on the purpose of the law. Once approved, the relevant institutions and organizations will receive the necessary resources from the fund, which will be paid within the scope of the expenditure program based on actual progress.
Any amount transferred in this manner will be recorded in the general budget for administration within the scope of the general budget, and in the budget of the relevant public institutions and organizations for other administrations.
The fund will be subject to independent auditing standards to ensure transparency and accountability. Financial data on fund sources and transfers will be shared with the public on a quarterly basis. Besides, the administrations that receive resources from the fund will be required to provide all necessary information and documents.
The fund will be exempt from corporate tax, and its revenues from activities related to its duties will not be considered income for tax purposes. However, transactions and documents related to the fund's activities subjected to stamp duty fees, donations and aid received by the fund will be exempt from inheritance and gift tax.
Banking and insurance transactions related to the fund's activities will also be subject to tax but will be exempt from deductions to the resource utilization support fund.
Cash donations and aid made to the fund can be deducted from declared income or corporate income, provided that they are separately indicated on the income or corporate tax return to determine the tax base.
The minister of treasury and finance will be authorized to allocate foreign financing to the disaster reconstruction fund for development, infrastructure and superstructure works in areas declared as disaster areas because of natural disasters affecting general life.
The minister will also be authorized to allocate external financing to relevant institutions and organizations for the same purpose, but only for institutions and organizations outside the public administration and within the scope of the general budget and this law.