Limitation Introduced on 2026 Property Tax Increases by Law No. 7566 and Its Impact on Pending Lawsuits
I. Introduction
In 2025, the minimum land and plot unit values per square meter (set to apply for the 2026–2029 period) were reassessed and, in many locations, increased beyond ordinary market trends. As property tax is calculated by reference to these unit values, the reassessment resulted in material increases in property tax liabilities. Many taxpayers therefore filed lawsuits before the tax courts seeking annulment of the relevant valuation commission decisions, in an effort to decrease their 2026 property tax rates.
Law No. 7566, published in the Official Gazette on 19 December 2025 and now in force, introduced a transitional rule aimed at limiting the increase in the taxable values used for calculating 2026 property tax. Under Article 10 of Law No. 7566, which amended Provisional Article 23 of the Real Estate Tax Law No. 1319, the building and land taxable values calculated for 2026 may not exceed twice the 2025 taxable values (in addition to the 2025 base).
However, the new omnibus law does not introduce any corrective mechanism or re-determination procedure for the minimum per-square-meter unit values themselves, which form the core subject matter of many of the annulment actions filed by taxpayers.
II. Scope of the Limitation Introduced by Law No. 7566
Provisional Article 23, as amended by Article 10 of Law No. 7566, establishes a cap mechanism limiting the increase in taxable values used for the 2026 assessment. Accordingly, the building and land taxable values calculated for 2026 under Article 29 of the Real Estate Tax Law may not exceed the statutory threshold determined by reference to the 2025 taxable values.
The amendment further provides that, for the years 2027, 2028, and 2029, both (i) the tax bases for building and land taxes and (ii) the minimum per-square-meter unit values for land/plots will continue to be calculated within the framework set out in Provisional Article 23. In addition, where taxes, fees, or other financial obligations are assessed by reference to the real estate taxable value or the minimum unit values per square meter, the values determined under Provisional Article 23 are to be taken into account.
In short, the mechanism introduced by Law No. 7566 limits the outcome at the level of the “calculated taxable value / tax base” for 2026, but it does not impose any limitation on, or introduce any direct regulation concerning, the minimum per-square-meter unit values determined in 2025.
III. Main Subject Matter of Lawsuits Filed by Property Owners
Under the system established by Article 29 of the Real Estate Tax Law, the taxable value for land and plots is determined by reference to minimum per-square-meter unit values set by valuation commissions. For this reason, in a significant portion of the lawsuits filed in 2025, the disputed act is the valuation commission decision determining the minimum unit values per square meter, the step preceding the calculation of the tax itself.
The main allegation raised in these cases is that the minimum unit values were increased in certain areas to a degree inconsistent with market data, and that the decisions do not set out a reviewable justification demonstrating how such increases were reached. Accordingly, the annulment request is directed not at the property tax amount as such, but at the administrative determination of the unit values that form the basis of the tax.
IV. Impact of the Amendment on Pending Lawsuits
Put simply, the subject matter of many lawsuits filed in 2025 is the valuation commission’s determination of minimum per-square-meter unit values for the 2026–2029 period. The cap mechanism introduced under Provisional Article 23 does not repeal or invalidate those valuation commission decisions. Therefore, it would not be accurate to conclude, as a general rule, that pending cases have become moot or have automatically come to an end. The challenged administrative acts remain in force, and the minimum unit values determined by those acts continue to be legally effective.
That said, the amendment has a practical effect for 2026: because the increase in the 2026 taxable value is capped, this limitation may indirectly reduce the 2026 property tax assessment in certain cases. However, this does not remove the underlying dispute as to the legality of the unit value determinations. Moreover, since the amendment provides that the framework under Provisional Article 23 will also be applied for the 2027–2029 period, the forward-looking effects of valuation commission decisions mean that the dispute cannot be treated as limited to 2026 alone.
For these reasons, even though the 2026 property tax payable by taxpayers may be limited under the new cap, the pending proceedings should continue in respect of the claims and requests challenging the minimum unit values per square meter.
V. Conclusion
Law No. 7566 has introduced a statutory cap mechanism for the 2026 property tax calculation, limiting the increase in the taxable values for buildings and land that form the basis of the tax. This mechanism is capable of reducing the increase reflected in the 2026 assessment.
At the same time, the law does not introduce any corrective measure or re-determination framework for valuation commission decisions establishing the minimum per-square-meter unit values for the 2026–2029 period. As a result, the core legality debate in the annulment actions filed in 2025—namely, the lawfulness of the unit value determinations—continues to remain relevant. For pending lawsuits, the cap mechanism affects only the financial impact of the 2026 assessment; it does not eliminate the underlying administrative act challenged in court.
