Of the total 12.5 million active retail payment gateways in Iran, only half have tax records, the deputy chief of the Iranian National Tax Administration said.
Mahmoud Alizadeh told state TV an estimated 3.8 million people operating about 6 million payment instruments have never filed tax returns.
“They should file their tax returns or their payment devices will be deactivated,” he warned.
INTA in coordination with Central Bank of Iran launched an action plan last year to connect payment gateways to the national tax system to curb tax evasion, mainly in the high income brackets.
Since January applicants for POS or other payment gateways have to first file their tax returns and those already owning the payment instrument are automatically eligible for tax.
The rule has “significantly curbed” illegal activities like using rented payment gateways. It has also helped in controlling illegal transfers, mainly money laundering and online betting, because owners of the gateways are held accountable and must pay tax.
With reports of rising tax evasion and tax exemptions, the government is struggling to curb rampant tax dodging that costs the country billions of dollars a year.
Control over POS devices in and outside Iran and tightening supervision of dubious bank transactions was put into effect in collaboration with administrative bodies, namely the CBI, the Ministry of Information and Communications Technology and INTA.
Regarding reports of bank transactions to INTA, Alizadeh said “online [integrated] connection is not yet possible to enable INTA’s instant access to bank transactions”. There are mechanisms that allow the taxman to dig into bank transactions.
Authorities say cooperation between INTA and CBI is crucial because control over POS devices is beyond INTA’s purview and the responsibility of Shaparak, the nationwide electronic payment settlement network affiliated to the CBI.
INTA has said that in implementing the new tax rules priority is given to payment gateways with high turnover.
The plan is in line with the so-called ‘smart taxation’ system announced by INTA. It says transition from electronic to smart taxation is premised on improving the tax regime, augment government funding, reduce dependence on oil revenue, promote fair tax collection and fight fraud.
