Ottoman Industrial Tax Exemptions

Ottoman State changed to look over economy after Tanzimat. No longer only financial concerns, but economic thoughts also began to consider. For this reason, state started to improve country’s industrial structure. Although allocating huge budget and showing enormous efforts to achieve industrialization, there were emerged some problems for this target. In addition to these, state entered some wars in this period. Because of these wars, state treasury met great difficulties to finance industry. As a result of this situation starting from 1880’s, private sector began to gain more place and importance in Ottoman industrialization. To support private sector in the way of industrialization, state gave some tax exemptions to entrepreneurs for technology transfer and raw material. Other than these, additional tax privileges were given to entrepreneurs to support them. But over time some abuses began to emerge. Because of this situation, state felt to need to have some control mechanisms. In order to be brought advance technology to country, industry administration began to examine demands of technology transfer. Ottoman State only supported the most advanced technology of that time which was steam power. Tax exemption allocated machines which had this technology. For the other important problem which was raw material, tax refund method would be implemented. The aim of this method was to check the usage of tax privileges for production, not for commercial purposes. Shortly Ottoman State had principle to support entrepreneurs which produced by using modern technology