Ms Farrell notes that, if the Turkish government managed to collect 90% of its value-added-tax revenues instead of the current 64%, it could lower the tax rate from 18% to 13% without sacrificing any income.

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The betting among London city analysts is that the new government will hike the Value Added Tax to 20% in early 2011 from its current 17.5%.

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This plan would replace the current system of taxes with a 9% individual flat tax, a 9% value added tax on corporations, and a 9% sales tax.

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