Varlık Vergisi
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The Varlık Vergisi (, "wealth tax" or "capital tax") was a tax mostly levied on non-Muslim citizens under the
Republican People's Party The Republican People's Party (RPP; , CHP ) is a Kemalism, Kemalist and Social democracy, social democratic political party in Turkey. It is the oldest List of political parties in Turkey, political party in Turkey, founded by Mustafa Kemal ...
(CHP) government in
Turkey Turkey, officially the Republic of Türkiye, is a country mainly located in Anatolia in West Asia, with a relatively small part called East Thrace in Southeast Europe. It borders the Black Sea to the north; Georgia (country), Georgia, Armen ...
in 1942, with the stated aim of raising funds for the country's defense in case of an eventual entry into
World War II World War II or the Second World War (1 September 1939 – 2 September 1945) was a World war, global conflict between two coalitions: the Allies of World War II, Allies and the Axis powers. World War II by country, Nearly all of the wo ...
. The underlying reason for the tax was to inflict financial ruin on the minority non-Muslim citizens of the country, end their prominence in the country's economy and transfer the assets of non-Muslims to the Muslim bourgeoisie. It was a discriminatory measure which taxed non-Muslims up to ten times more heavily and resulted in a significant amount of wealth and property being transferred to Muslims.


Background

The Şükrü Saracoğlu government introduced a bill for a one-off tax, which was approved by the Turkish parliament on November 11, 1942. This tax targeted fixed assets, including landed estates, buildings, businesses, and industrial enterprises owned by all citizens but disproportionately affected minorities. Non-Muslim communities, such as
Jews Jews (, , ), or the Jewish people, are an ethnoreligious group and nation, originating from the Israelites of History of ancient Israel and Judah, ancient Israel and Judah. They also traditionally adhere to Judaism. Jewish ethnicity, rel ...
,
Greeks Greeks or Hellenes (; , ) are an ethnic group and nation native to Greece, Greek Cypriots, Cyprus, Greeks in Albania, southern Albania, Greeks in Turkey#History, Anatolia, parts of Greeks in Italy, Italy and Egyptian Greeks, Egypt, and to a l ...
,
Armenians Armenians (, ) are an ethnic group indigenous to the Armenian highlands of West Asia.Robert Hewsen, Hewsen, Robert H. "The Geography of Armenia" in ''The Armenian People From Ancient to Modern Times Volume I: The Dynastic Periods: From Antiq ...
, and Levantines, who played a significant role in the economy, were particularly hard-hit, with
Armenians Armenians (, ) are an ethnic group indigenous to the Armenian highlands of West Asia.Robert Hewsen, Hewsen, Robert H. "The Geography of Armenia" in ''The Armenian People From Ancient to Modern Times Volume I: The Dynastic Periods: From Antiq ...
bearing the heaviest tax burden. While the tax was supposedly meant for all Turkish citizens, it disproportionately burdened non-Muslims with exorbitant and arbitrary rates. "But in its application it differentiated between Muslim and non-Muslim taxpayers, and levied far heavier taxes on non-Muslims, leading to the destruction of the remaining non-Muslim merchant class in Turkey." "They were almost exclusively non-Muslims. The law was thus perceived by the public as a "punitive measure" against non-Muslims."." The consequences were severe—the remaining non-Muslim merchant class was decimated, and many non-Muslim families faced financial ruin. The taxes reached staggering levels, at times surpassing an individual's entire wealth. The law applied even to impoverished non-Muslims like drivers, workers, and beggars, while their Muslim counterparts enjoyed exemption. The Varlık Vergisi led to a number of suicides among ethnic minority citizens in
Istanbul Istanbul is the List of largest cities and towns in Turkey, largest city in Turkey, constituting the country's economic, cultural, and historical heart. With Demographics of Istanbul, a population over , it is home to 18% of the Demographics ...
. During
World War II World War II or the Second World War (1 September 1939 – 2 September 1945) was a World war, global conflict between two coalitions: the Allies of World War II, Allies and the Axis powers. World War II by country, Nearly all of the wo ...
, Turkey maintained a neutral stance until February 1945. The official rationale for the tax was to bolster the state treasury in preparation for a potential invasion by
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or the
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. However, the primary motive behind the tax was to assert national control over the Turkish economy. By diminishing the influence and control of minority populations in trade, finance, and industries, the government aimed to create a new Turkish Muslim bourgeoisie. The tax could not be challenged neither by legal nor administrative means, except if there was a duplication. Non-Muslims were given a 15-day window to pay their dues in cash. Those unable to meet the obligation resorted to borrowing from friends or family, selling properties at public auctions, or offloading businesses to gather funds. For those incapable of payment, they were sent to labor camps in eastern Anatolia. Though workers received wages, half was deducted to offset their debts. Elderly individuals, unable to endure the rigorous labor, collaborated with younger villagers from AÅŸkale, paying them daily wages to work in their stead. All five thousand sent to the labor camps were non-Muslims, as Muslim taxpayers faced milder consequences. Despite the law exempting those over fifty-five from labor service, even elderly and sick individuals found themselves dispatched. Twenty-one people died in these camps, and their wealth was confiscated by the Turkish government and sold at significantly reduced prices to Turkish Muslims, laying the groundwork for some contemporary Turkish conglomerates. The state also seized property from close relativesparents, parents-in-law, children, and siblingsselling it to settle tax amounts, even if the individual had been consigned to forced labor. Taxpayers were classified into four separate lists, the "M" list, for Muslims, the "G", for non-Muslims ('' Gayrimuslim''), the "E", for Foreigners (''Ecnebi'') and the "D" for converts ('' Dönme''). Foreign-passport residents in Turkey who gave in a tax return or owned a business were forced to pay a huge capital levy on supposed wealth too, although none of them were ruined or committed suicide. Devoid of any factual basis, the tax seemed to arise solely from the authorities' whims, prompting foreign embassies and consulates to intervene on behalf of their nationals. During the period, the Turkish press allegedly published "anti-minority" articles and reports. Official figures revealed that the Turkish government collected TL 324 million (when 1 US dollar equaled 1.20 Turkish lira) through the confiscation of non-Muslim assetsan amount surpassing $4 billion in 2022. According to , the director of finance for the province of Istanbul at the time during the Varlık Vergisi, TL 289,256,246 was collected from non-Muslim minorities, TL 34,226,764 from converts, and TL 25,600,409 from Muslims. Despite the government's rigid enforcement of this discriminatory law, it failed to achieve the intended results. Companies, compelled to offset losses, sharply increased product prices, triggering an inflationary spiral that adversely impacted low-income consumers.


Repeal and aftermath

International pressure led to the repeal of the controversial law on March 15, 1944, driven by strong criticism from the
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and the
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. Following its abolition, minority citizens detained in labor camps were released, and though the Turkish government pledged to refund paid taxes to non-Muslims, this promise went unfulfilled. The opposition Democratic Party (DP) capitalized on its unpopularity in the general election of 1950, which was the first democratic general election in the Turkish Republic, thereby securing a landslide victory against the
Republican People's Party The Republican People's Party (RPP; , CHP ) is a Kemalism, Kemalist and Social democracy, social democratic political party in Turkey. It is the oldest List of political parties in Turkey, political party in Turkey, founded by Mustafa Kemal ...
(CHP). The enduring impact of these taxes manifested in a lasting demographic shift within minority populations. Many, particularly the Greek minority, perceived an uncertain future in Turkey and sought refuge in Greece. Conversely, some from the Jewish community, having safeguarded assets abroad, managed to rebuild a more cautious life in Turkey. The tax precipitated the closure or sale of small businesses to larger entities, consolidating control in the hands of major business interests. It also facilitated state confiscation of significant minority property in Istanbul, not only reshaping the economy but altering the urban landscape as well. The 1935 Census recorded non-Muslims as 1.98% of the population; by 1945, this had fallen to 1.54%. In addition, the Varlık Vergisi underscored that being Muslim held substantial implications for Turkish citizenship. Its treatment by the Turkish press highlighted the close ties between the Executive and the Press in the country. In 1951, Faik Ökte, in his memoirs, admitted to the discriminatory application of the tax against non-Muslims. The Turkish press condemned him as a "traitor to the homeland" for publishing such revelations.


In popular culture

The historical novel ''Salkım Hanım'ın Taneleri'' (variously translated as ''Mrs. Salkım's Diamonds/Pearls/Beads/Necklace''), written by Turkish author Yilmaz Karakoyunlu, recounts stories and witnesses of the non-Muslims during the Varlık Vergisi. The same novel was turned into a film of the same name, '' Mrs. Salkım's Diamonds''. Members of parliament, such as ( MHP), were outraged at the screening. The
Netflix Netflix is an American subscription video on-demand over-the-top streaming service. The service primarily distributes original and acquired films and television shows from various genres, and it is available internationally in multiple lang ...
series ''The Club'' revolves around a Jewish woman who was victimized by the tax and its aftermath.


See also

*
Economic history of Turkey The economic history of the modern Republic of Turkey has four eras. The first era's development policy was defined by the transition from an agricultural imperial Ottoman economy into a diversified more industrialized economy. It emphasized on p ...
*
Taxation of the Jews in Europe Taxation of the Jews in Europe refers to taxes imposed specifically on Jews in Europe, in addition to the taxes levied on the general population. Special taxation imposed on the Jews by the state or ruler of the territory in which they were living ...
for other types of taxes imposed on the Jews *'' Judenvermögensabgabe'', a similar tax targeting wealthy Jews in Nazi Germany * Confiscated Armenian properties in Turkey *
Jizya Jizya (), or jizyah, is a type of taxation levied on non-Muslim subjects of a state governed by Sharia, Islamic law. The Quran and hadiths mention jizya without specifying its rate or amount,Sabet, Amr (2006), ''The American Journal of Islamic Soc ...
*
Dhimmi ' ( ', , collectively ''/'' "the people of the covenant") or () is a historical term for non-Muslims living in an Islamic state with legal protection. The word literally means "protected person", referring to the state's obligation under ''s ...
* The Twenty Classes * Human rights in Turkey * Freedom of religion in Turkey * Xenophobia and discrimination in Turkey


References


Further reading

* * * * * {{DEFAULTSORT:Varlik Vergisi 1942 in Turkey 1942 in law Anti-Armenian sentiment in Turkey Antisemitism in Turkey Discrimination in Turkey Greeks in Turkey Turkey in World War II Taxation in Turkey Turkish words and phrases Economic history of Turkey Persecution of Christians in Turkey Property taxes Racism in Turkey Anti-intellectualism Racial segregation Turkish nationalism