Economy, Domestic Economy

$70 Oil in Budget Criticized

$70 Oil in Budget Criticized$70 Oil in Budget Criticized

Following the announcements on Tuesday that the administration has prepared the budget bill based on oil price of $70 per barrel, economists have rejected the decision as wrong.

“In my opinion, the administration should set the oil price at $50 per barrel in next year’s budget plan so that any surplus could be directed to the National Development Fund of Iran (NDFI),” Behnam Maleki, an economist and university lecturer told ISNA on Wednesday.

The country has always been grappling with overt and covert budget deficit that mainly arises from “current expenditures and not capital expenditures,” Maleki noted.

He regretted that all parties await the flood of oil revenues to spend and said that “the only way to stay detached from oil revenues is that the administration unties hopes on this source of revenue.”

He considered unrealistic the oil price of $100 set by the government in the current budget law, urging authorities to reduce reliance on oil revenues.

Maleki considered taxation “on the hidden and underground economy” as a solution to counter the decline in oil prices and said. “We have to levy tax on the revenue that is generated through rent-seeking and destructive monopoly, remove unnecessary tax exemptions and give low-income and vulnerable groups tax holidays.”