Majlis Ends Pricing Saga

Majlis Ends Pricing SagaMajlis Ends Pricing Saga

The Iranian Parliament on Tuesday passed a bill that allows the government to supply gasoline at a single price, repealing a controversial law passed in April to introduce a two-tier pricing scheme.

The bill was part of amendments to Iran's Budget Law for the current Iranian year (ending March 20, 2017) sent to the parliament for ratification on Tuesday, Shana reported.

"It was previously stipulated in the Budget Law that gasoline should be sold via electronic fuel cards and quotas be allocated with respect to consumption of each vehicle. But the government sought to nullify the law and Majlis Energy Commission approved it," said Mehdi Mofatteh, the rapporteur of Majlis Energy Commission.

The previous legislation, spearheaded by a group of conservative-leaning lawmakers and officials, sought to nullify the efforts of the moderate government of President Hassan Rouhani to unify gasoline prices in May 2015.

Two-tier pricing scheme was the subject of much debate and controversy in recent months, as officials close to the Rouhani administration considered it an effort to undermine the government.

The new enactment also invalidates fuel cards, which were issued during the tenure of former president Mahmoud Ahmadinejad nine years ago.

Under the new scheme, the fuel card system effectively loses sight of its original purpose of allocating quotas and monitoring consumption—neither of which is currently implemented.

However, Mofatteh indicated that the amendment was particularly aimed at reversing the two-tier pricing scheme, but there are currently no plans to discard the fuel card system.

"According to the law, fuel cards can remain in place and gasoline will be sold at gas stations via the cards, but gasoline for all consumption levels will remain the same," he added.

Prominent figures have been outspoken in opposing the new law. According to the government spokesperson, Mohammad Baqer Nobakht, and Oil Minister Bijan Namdar Zanganeh, forcing the two-tier pricing scheme to maintain fuel cards would trigger corruption.