Reducing taxes on production units active in the stock market, strengthening the Capital Market Development and Stabilization Fund, eliminating subsidized foreign currency allocations, and stabilizing the ownership interest of the mines are some of the measures considered in the budget bill to support the capital market.

Allocating a 20-percent tax on legal entities is considered in next year’s budget bill which is less than the previous years. Reducing the taxes imposed on production units will make them more profitable and therefore their performance in the stock market will improve.

Also, the direct taxes collected from production nits is expected to be injected into the Capital Market Development and Stabilization Fund in order to be used to improve and develop the market.

Based on the next year’s budget bill, no subsidized foreign currency will be allocated to special entities to import certain goods. Experts and analysts believe that this decision is going to have a very positive impact on the stock market since it will prevent rent and unrealistic pricing.

The draft of the national budget bill also indicates that the government will be less reliant on the stock market to compensate deficits and fund various development projects which is another positive aspect of the mentioned bill since the stock market will be less affected by the politics and will follow a normal trend created by supply and demand.

Earlier this month, Market Analyst Peyman Hadadi had said that the national budget bill for the next Iranian calendar year indicates that the government has a more positive view of the market for the upcoming year.

According to Hadadi, the allocation of a separate budget for the Capital Market Development and Stabilization Fund shows that the government is taking the necessary measures to provide stronger support for the market and to ensure its growth in the future.

“The allocation of a budget line for the Capital Market Development and Stabilization Fund is considered one of the most important points of the [Iranian calendar year] 1401 budget bill,” Hadadi said.

The expert also pointed to the imposition of tax on rival markets including the housing market as another important and influential change in the next budget bill and said: “Taxation of luxury cars and expensive housing, along with taxation of bank deposits of legal entities, is also one of the important issues that should be appreciated about the budget bill.”

He also mentioned the elimination of subsidized foreign currency allocations and noted that this would create huge changes in the market and will be the starting point for some positive progress in some industries active in the market.

The elimination of subsidies on foreign currency is not only beneficial for the country’s macro-economy but also has a positive effect on the capital market transactions, the analyst said.

He further pointed to the reduction of taxes on manufacturing companies and added: “The important action of the government in reducing the tax on production units from 25 percent to 20 percent will largely offset the increase in energy costs.”

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The proposed budget amounted to about 36.31 quadrillion rials (about $132.518 billion at the exchange rate of 274,000 rials).

While rising tax revenues is being considered as one of the strategies of the government to compensate for the reduction in the oil income and combat the sanctions, the next year’s budget bill has envisaged 5.27 quadrillion rials (about $19.233 billion) tax income, which is 62 percent higher than the figure for the current year.

Meanwhile, new tax bases have been considered in the budget bill, among them it could be referred to taxes on houses and cars.

According to the 1401 budget bill, the first real estate deal for newly constructed buildings that are not more than three years old will be subject to a 2.5-percent tax.

The deal on newly built homes will also be subject to a 2.5-percent tax.

All real and legal owners of villas and expensive residential units whose property is worth 100 billion rials (about $365,000) and above are obliged to pay the relevant annual tax before the end of the next year’s eleventh month of Bahman (February 19, 2023).

The bill states that the villas and residential units under construction will not be taxed.

Meanwhile, the Ministry of Transport and Urban Development is obliged to provide the Iranian National Tax Administration (INTA) with the possibility of online access to the property ownership information required by the INTA.  And INTA is obliged to determine the eligible assets and their value by the end of the third month of Khordad (June 21, 2022) at the latest and to inform the persons in an appropriate manner.

Also, according to the budget bill for 1401, the total value of all types of passenger cars and two-cab vans with personal numbers, for individuals (themselves and children under 18 years of age and dependents) and legal entities, of more than 10 billion rials (about $36,500) is subject to tax.

The source of calculating car taxes is the daily price of all types of cars according to the date of manufacture or import, which is determined and announced by the INTA by the end of year 1400 (March 20, 2022).

And INTA is obliged to determine the eligible assets and their value by the end of the third month of Khordad (June 21, 2022) at the latest and to inform the persons in an appropriate manner.

The above-mentioned are two cases regarding the new tax bases in the next year’s budget law.

As repeatedly emphasized, Iranian government is seriously pursuing the strategy of reducing reliance on oil incomes, while relying more on other sources of revenues such as non-oil export and tax; and in this regard setting new tax bases and collecting taxes more systematically, while seriously preventing tax evasion are on agenda.

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Speaking in the meeting of the government and the Majlis on Wednesday,Raisi said, “We consider consulting with our friends in the Majlis and experts as an asset for us.”

Referring to the priority of a bill over a plan in the statements of the Supreme Leader of the Revolution in a meeting with the members of the Islamic Consultative Assembly, the President emphasized, “Sometimes the concerns of the parliament members are presented in the form of a plan; this is the right of the representatives, but if the plans are drafted using the opinion of experts and government officials, they will become law with more richness”.

While emphasizing the clarification of the provisions of the Sixth Development Plan, Ayatollah Raisi said, “The next year budget is the first document that is to be submitted to the parliament. The head of the Plan and Budget Organization will take advantage of the opinions of MPs to draft a budget bill. The government wants the 1401 budget not to have deficits and inflation and to have economic growth.”

The President described legislation and laying the rails for the movement of society as the great duty and responsibility of the Islamic Consultative Assembly and said, “The parliament is a manifestation of the will, vote and discernment of the people and today in our country this laying for the society is manifested in the form of legislation”.

Emphasizing the need to pay attention to the implementation of the law, Raisi said, “All individuals and officials, without exception, should define themselves with the law and be obliged to implement the law, because the law is the center of society”.

Ayatollah Raisi stated that the best and most important criterion for the administration of justice is the implementation of the law, adding, “The criterion for measuring justice in society is agreement on the implementation of the law, and if the law is enforced, justice is enforced and if the law is violated, justice is violated”.

The President considered it important to keep the laws up-to-date and efficient, and said, “But more important is the effort to revise the laws, which the Supreme Leader of the Revolution has repeatedly emphasized, and the parliament is central to this issue.”

Raisi described the convergence, empathy and cohesion of all parts of the country necessary for the correct implementation of laws and emphasized, “The coordination and integration of the three branches in all systems and institutions are not a tactic but a strategy that should not be compromised in any way.”

Ayatollah Raisi said, “The result of ignoring spirituality and politics in today’s world is the increase of nuclear warheads, 70 years of oppression on the Palestinian people and many oppressions that occur in different parts of the world.”

He also underlined the need to politics go hand in hand with spirituality, saying today’s problems in the world stem from the separation of the two from each other.

He said the divorce of politics from spirituality led to the production of nuclear warheads.

The president said Iran’s Parliament today is the manifestation of people’s will, and that a country where elections are held must ensure the prevalence of law. Raisi also said just laws, just enforcement of laws and just judgments are main pivots of administering justice.

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IRAN NEWS NATIONAL DESK

TEHRAN – Spokesman to the Guardian Council says Majlis cannot change the structure of next year’s budget bill which has been submitted by President Hassan Rouhani and it can only change details and figures of the bill.

Speaking in a presser, Abbas-Ali Kadkhodaee reacted to claims of some Majlis lawmakers, who have claimed Majlis will reject the government budget bill and will have a new one, and said Majlis is not in a position to change the structure of budget bill but it can change the details and figures in the bill.

He said the GC is concerned about the budget bill and it has always been because the budget bill should be an efficient one and proportionate to the national needs and to cover all sectors. He added the council expects Majlis to review the bill with more care and scrutiny. He reiterated that if Majlis decides to change the whole structure of the budget bill, the council will reject it because it is against the Constitutions.

In response to the question on the Guardian Council’s opinion to amend the presidential election law which is being considered and approved by the parliament, Kadkhodaee highlighted that until the ratification of the Guardian Council is not received, no comment can be made, and any comment without approval is considered personal.

Amending the law is a measure that the Islamic Consultative Assembly has taken, but it is not yet possible to predict, he stressed.

Responding to the question on “If the COVID-19 outbreak would be acute until the presidential election, are new voting methods will be implemented, Kadkhodaee stated that if you mean vote by mail ballots, the law does not allow to do so, but we give our advice and comments to the parliament and the Ministry of Interior.

Working groups have been formed between the Ministry of Interior and the Guardian Council, and if there is no need to amend the law, we will increase the number of polling stations, yet presidential election voting will be electronic.

While congratulating Nurse Day, the Guardian Council spokesman underlined that the nurses and medical staff carried out their duties perfectly amid the coronavirus outbreak and even some of them lost their lives while combating the disease and saving people’s lives.

Condemning Martyr Mohsen Fakhrizadeh’s assassination by terrorists, the Guardian Council Spokesman noted that the enemies cannot bear the Islamic Republic of Iran’s scientific progress.

On the next year presidential election, he said health of election is the major task of all bodies and safeguarding people’s votes is the main task and the other task this year will be the health of voters in the coronavirus condition.

He added that this year all executive bodies and GC should try to plan the elections in a way that all sanitary protocols are observed. On electronizing the election, he said the infrastructures should let the elections be held electronically and the interior ministry is pursuing this idea to prepare the infrastructures and the GC will not oppose e-voting.

On registering for the presidential election, Kadkhodaee said that all those who have disqualified in the past also can register for the presidential election but the GC will decide their fates based on the current condition and documents.

He expressed hope the amendment of the presidential election would be completed before the start of registration for the election.

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IRAN NEWS ECONOMIC DESK

TEHRAN – Vice President for Legal and Parliamentary Affairs submitted the President Rouhani administration’s proposed budget bill for the next Iranian fiscal year (which will begin in March 2020) to the parliament on Wednesday.

Hossein-Ali Amiri as the Vice-President for Legal and Parliamentary Affairs submitted Iran’s national budget bill to Parliament on Wednesday.

The bill was used to be submitted by President Rouhani himself but this year he did not attend today’s Parliament session due to, as he described, the anti-coronavirus protocols.

The copies of the proposed bill provided to the MPs will be examined and the MPs will give their suggestions and views to the specialized commission that will be set up for studying the bill within a month.

VP for Legal and Parliamentary Affairs submitted Iran’s national budget bill to Parliament on Wednesday.

The parliament will then review the budget bill in an open session.

According to the internal regulations of the Iranian parliament, the administration should present the annual budget bill by December 5 each year.

Once the parliamentarians endorse the government’s proposed budget bill, it will go to the Guardian Council, the constitutional supervisory body, for ratification before becoming law.

The head of the Iranian Parliament’s Planning and Budget Commission said that in the examination and adoption processes of the next Iranian year budget (starting on March 21), the transparency of the sources, spending areas, as well as helping the lower class must be considered.

Hamidreza Hajibabai said the parliament has taken into account structural reforms for the next year’s budget.

Hajibabai emphasized that the budget plan must move on the path of social justice and that the next year’s budget must lead to boosting production and accelerate the cycle of production in the country.

The head of the Parliament’s Planning and Budget Commission said in the next year’s budget of 2021, reliance on oil must be decreased and more importantly, the government’s dependence to oil and vice versa must become transparent.

Meanwhile Majlis Speaker described petrodollars as an unreliable source of income while the administration is going to submit its proposed budget bill for the next Iranian fiscal year (which will begin in March 2021).

Addressing a parliamentary session on Wednesday, Mohammad Baqer Qalibaf said what must be taken into account in formulating the national budget is non-reliance on oil incomes, which has been repeatedly stressed by Leader of the Islamic Revolution Ayatollah Seyed Ali Khamenei.

The Parliament speaker said the budget’s dependence on petrodollars would be totally damaging and abortive.

The overriding concern is a budget deficit, he said, adding that the Parliament is pushing for a budget reform with new sources of revenue.

It is estimated that Iran’s budget revenues for next Iranian year (from March 21, 2021, to March 21, 2022) will amount to a total of 8.41 quadrillion rials (about $241 billion), Iranian President Hassan Rouhani said at a meeting of the Iranian government.

According to President Rouhani, the amount of revenues estimated for the next Iranian year’s budget has increased compared to the current year’s budget.

Rouhani added that the basis of budget revenues are taxes, customs revenues, duties, securities, stocks, and oil.

The president stressed that it is hoped that Iran’s crude oil sales will be normal in the next Iranian year.

‘According to budget, it is estimated that daily 2.3 million barrels of crude oil and gas condensate will be sold. The Iranian government considers that these products can be sold both in domestic and international markets,’ he said.

The president stressed that not all revenues from the sale of Iranian crude oil and gas condensate are intended for the budget.

According to the budget, it is estimated that 645,000 barrels of crude oil will be sold per day. Thus, Iran’s daily revenues from crude oil (a barrel equals to $40) will amount to $26 million, and annually about $9.5 billion.

Iran’s budget revenues for the current Iranian year (from March 20, 2020, to March 21, 2021,) was estimated to be a total of 3.38 quadrillion rials (about $80.4 billion). However, so far, this figure has been 2.9 quadrillion rials (about $69 billion).

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TEHRAN (Iran News) – Budget deficit in Russia could reach 0.9% of gross domestic product (GDP) in 2020 at current oil prices, Finance Minister, Anton Siluanov told the upper house of parliament on Saturday.

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