Turkey Leverages Iran War Fallout to Pitch Istanbul as a Financial Hub with Tax Incentives

Turkey’s president said the Iran war will open new doors for the country, echoing the boost it saw during the pandemic.

Ankara is promoting Istanbul as a safe haven for businesses while Gulf hubs face missile attacks and shipping disruptions.

The Istanbul Financial Center, launched in 2023, grants a 100 percent corporate tax exemption on export earnings until 2031 for firms registered in the zone.

Under the rule, a company that invoices sales through an Istanbul entity but does not bring the goods into Turkey can book the revenue as export income and avoid corporate tax.

Dubai’s DIFC offers a similar zero‑tax regime for up to 50 years, and the city ranks seventh in the Global Financial Centres Index, while Istanbul sits at 101st.

The BIST 100 index slipped 1.2% to 9,850 points on October 28, and the Turkish lira traded at 32.45 per USD, down 0.8% from the prior session.

Garanti Bankasi (GARAN.IS) holds a market cap of roughly 180 billion TL, while the Dubai Financial Market index rose 0.5% to 4,120 points.

Analysts say the tax incentive could draw commodity traders and logistics firms seeking to route invoices through Istanbul, but the city’s low ranking and currency volatility remain hurdles.

Watch for upcoming Treasury announcements on additional incentive packages and for any shift in foreign direct investment flows into Turkey’s financial sector.