The government says it has been successful in raising its revenues from taxes. “Iran’s tax revenues increased by 53 percent during the first nine months of the current year compared to the same period last year,” Ali Asgari, head of the National Tax Administration, said on Thursday, predicting that 95 percent of this year’s projected tax revenues are to be materialized by the end of the current year, ending March 21.
Raising tax revenues is seen as a remedy to the country’s economy that has been crippled by unprecedented stagflation (high inflation and recession at the same time). Under such circumstances, economists argue that the government needs to identify tax evaders and make them pay their share to shore up the economy.
Based on the new regulations, tax evaders would face additional penalties such as confiscation of their assets, blacklisting, and long-term financial restrictions.
Charities Must Be Tax Exempt
Minister of Roads and Urban Development, Abbas Akhoundi, says community-based charitable organizations that contribute to development of infrastructure projects should be exempted from taxation.
“The government’s revenues from taxes are usually spent on construction of schools, hospitals, roads, health facilities and environment; therefore, those who are voluntarily doing charitable jobs must be exempt from tax,” IRNA quoted him as saying.
The minister’s remarks are expected to further encourage people’s participation in an economy that is largely run by the government. Latest statistics suggest that only 40 percent of businesses in Iran pay taxes.
“Why should someone who is doing social services pay tax?” Akhoundi asked, underlining the fact that such services should be basically delivered by the government and charities help the government to reduce its expenses by delivering voluntary services.
The government is trying to generate new sources of revenues through taxes that can replace its traditional oil revenue, a shaky source of income for the economy that has been severely hit by sanctions imposed by the West on the oil industry as well as the recent drastic plunge in international oil prices.
