On September 27, the state-run Shargh newspaper reported that tax revenues in Iran have doubled in the past six months, surpassing the income from crude oil. According to the source, Ebrahim Raisi’s government now leans more towards tax income to fund its operations.
It’s important to recognize that many governments around the world employ strategies to gather tax revenues, aiming not to burden the underprivileged and reduce their quality of life to bridge budget gaps. Taxation should aim for economic equilibrium in society, drawing from significant sources like company profits and capital from investors. But as discrimination and inequality are part of the clerical regime’s DNA, the entire nation is plagued by excessive taxation of the Raisi’s government, and therefore, state media are sounding the alarm that this might turn out dangerously for the regime.
On October 6, the state-run Saat24 wrote, “Last winter, while the government increased workers’ wages merely half the size of the previous year’s inflation rate, recent reports indicate that the government has actually collected more taxes than the inflation rate of the previous year. The latest figures published by the Iranian Tax Administration show that the government collected 344 trillion tomans in tax revenue in the first 6 months of this year. This tax revenue is 39 trillion tomans more than the total tax collected in the year 2021 (equivalent to 305 trillion tomans), indicating that the government has aligned its tax expectations with its own production-based inflation. However, it has suppressed living expectations and wages, keeping them below the historical inflation rate for the past 7 years. This level of tax revenue realization aligns with 92% of the amount stipulated in this year’s budget bill.”
The source also warned, “It is worth noting that the seemingly diverse approaches to taxes pose the greatest political and security challenges that the government will soon face. Among them, the significant capital flight (some statistics confirm up to 100 billion dollars) is one aspect of this threat.”
Mojtaba Amiri, the head of the Planning and Financial Statistics Group at the National Tax Administration, stated in an interview with the official news agency IRNA, “The share of tax revenues in covering the current expenses of the government in the first five months of this year has shown a significant growth compared to the past years. These revenues have reached 56%, while this ratio was 48% last year.”
Watch and judge how the clerical regime is spending #Iran's oil and tax revenues pic.twitter.com/6ejsMtpgPm
— NCRI-FAC (@iran_policy) August 18, 2023
In Iran’s dictatorial system, particularly under Ebrahim Raisi’s government, the approach stands in contrast to other nations. Taxes here are not levied on foundations like the Mostazafan Foundation, the Martyrs’ Foundation, or the Execution of Imam Khomeini’s Order (EIKO) also known as the Executive Headquarters of Imam’s Directive (Setad). Instead, individuals such as workers, teachers, farmers, and retirees are taxed. Even “kulbars’, laborers enduring arduous freight carrying work, or the deprived fuel carriers in Baluchestan, are obligated to pay taxes, or else their right to livelihood is jeopardized. On the other hand, financial and economic companies linked to the Revolutionary Guard, boasting substantial revenues and capital, enjoy tax exemptions.
In a recent report, Aftab News disclosed that 40 semi-private companies have been granted full tax exemptions. The report emphasizes a growing trend of tax pressures to cover the government’s ongoing expenses. Despite significant economic growth, the thirteenth government has adopted a lenient approach toward tax pressures, providing tax exemptions to wealthy conglomerates such as Mobarakeh Steel, Persian Gulf Holding, Copper Industries, Pars Petrochemicals, Ghadir Investment, and Omid Investment.
Semi-private companies are corporations that, by exploiting the regime’s commercial laws, establish businesses and hinder the growth of the private sector. Legally, these companies are classified as private entities, but they are effectively under government oversight.
Warning against excessive taxing, the state-run Arman Meli wrote, “Tax pressure under the pretext of adhering to current global tax policies is not accurate. Economic enterprises are facing significant challenges due to sanctions, and imposing heavy tax burdens, especially on small retailers, will soon manifest itself as a form of protest. People can see that despite the taxes collected, they are not receiving the desired and comprehensive services.”