Turkey’s parliament has approved the country’s 2018 budget, which includes increased spending on defence and projects a rise in the fiscal deficit to 65.9 billion lira ($17.28 billion).
The budget, approved by parliament late on Friday, introduces changes in tax regulations, such as tax increases for companies and motor vehicles, to help pay for increased security, reports Reuters.
In 2017, the emerging market economic country’s budget is expected to show a deficit of 61.7 billion lira, more than twice the 2016 budget deficit of around 30 billion lira.
Turkey’s 2018 budget also projects tax income of 599.4 billion lira, up some 15 per cent from estimates for 2017, and a 5.8 billion lira primary surplus.
Over the past two years, the country’s current account deficit has widened due to increasing government incentives to boost the economy and defence spending, the report said.
Next year’s budget deficit to gross domestic product ratio is expected to be 1.9 per cent.
The government says the additional defence spending is urgently needed to modernise the military, the second-largest in the NATO alliance, and meet the costs of domestic and foreign security operations.
Turkey’s economy has rebounded from a downturn that followed an attempted coup last year, helped by a series of government stimulus measures.
GDP grew 11.1 per cent year-on-year in the third quarter, its fastest expansion in six years, according to official data.