Abstract:

Minimum wage policies are among important tools in the fight against unemployment and poverty. However, in many cases, the income tax on minimum wage which itself is well below the poverty line and the other tax burdens reduces the functionality of minimum wage. As a result of the minimum wage allowance practice of Turkey, income tax here on the worker who earn minimum wage reduces about 40 percent. However the tax here on minimum wage are still above 20 percent. When we take into account the poverty line, even the gross minimum wage is not enough to compensate the necessary needs of minimum wage worker or his or every family. While this is the case, the practice of putting some tax burdens on the minimum wage demands the legitimacy of the state. Because of these, in such a period in which the government has some attempts to reform the tax system, the main task of responsible administration may be to design a minimum wage and tax system which is compatible with the equality principle.

Keywords: