Individual Pension System: An Assessment on Tax Relief and Government Contribution

Nadide Yiğiteli (), Derya Karagöz and Yusuf Demirci

Bulletin of Economic Theory and Analysis, 2019, vol. 4, issue 2, 33-63

Abstract: We conclude that gender, age and provincial variables are statistically significant variables in IPS participation in Turkey. Also, according to our results, the state contribution incentive system positively differentiates the number of participants and the results are statistically significant. Finally, the study finds that compared with the tax incentive, the state contribution encourages people to stay in the system for a longer period of time and thus serve the purpose of increasing savings rates. In this study; gender, age and provincial variables of IPS participation were examined in Turkey. Then, it was investigated whether the state contribution incentive implemented in place of the tax incentive had a statistically significant effect on the number of participants. In addition, the benefits that an individual entering a individual pension system would receive in the old and the new system were compared. Individual Pension System (IPS) is a defined contribution-based pension system that has a complementary role to public pension systems. The (IPS) has two main functions. These are the functions of providing additional income for retirement periods and increasing the level of savings in the economy.

Keywords: Savings; Individual Pension Schemes; Pension System Tax Relief; State Contribution (search for similar items in EconPapers)
JEL-codes: E20 E21 G22 G28 (search for similar items in EconPapers)
Date: 2019
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