Retailers demand assistance as minimum wage hike looms

“If the proper precautions aren’t taken, the sector may wither. While it may be unwanted, small markets with falling revenues may close and employment may decrease,” said Turkey Retailers Federation (TPF) board chairman Mustafa Altunbilek in a statement on Tuesday.

The minimum wage committee will meet on Wednesday to discuss the wage for the period beginning Jan. 1, 2016. The ruling Justice and Development Party (AK Party) has pledged to increase the wage from TL 1,000 to TL 1,300, a move which has sparked fears that many sectors will not be able to meet this increase without subsidies.

The TPF represents retailers employing 72,000 workers, and 80 percent of these earn the minimum wage, according to Altunbilek. Although he welcomes an increase in wages for workers, he says this hike will result in a significant decline in profits for retailers.

In the new year, retailers will have to dispose of upwards of 10,000 old cash registers, replacing them with new ones allowing them to receive credit card payments and make an invoice with a single device. Altunbilek said this will also result in a huge cost burden for the sector.

In the statement Altunbilek finished with a proposal that the state take on some of the burden of the proposed increase, which he said will result in a hike of TL 456 per employee for retailers. He said the government should also lower the value-added tax (KDV) and extend the period of time that retailers have to change their cash registers.