Özet:

The concept of fiscal space has gained prominence in the literature since the early 2000s. Although it was originally perceived as a tool to create additional resources in only developing countries, the concept also became important in developed countries with the 2008 economic crisis and COVID-19 pandemic. This article reviews the literature on fiscal space, including various definitions and explains the efforts to create fiscal space in countries. The article analyzes revenue and expenditure policies of Türkiye by using the methodology of Peter Heller. In terms of revenue policy, tax revenues fluctuated around 24 percent. Between direct and indirect tax proceeds, there has been a swamp between direct and indirect taxes—direct tax revenues becoming less important. In terms of expenditure policy, the decline in interest payments due to the stabilization policies pursued by the government has created space to finance social service expenditures, such as education, healthcare, and social protection. Under the light of these developments, we analyze the fiscal space creation efforts of the government.

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