TEHRAN (Iran News) Seyed Mohammad Hadi Sobhanian, head of the National Tax Administration, said at a press conference reviewing the organization’s performance in the Iranian year 1404 that the past year had been “different and difficult” compared to previous years.

“Despite the circumstances, we tried to fulfill our legal duties to the maximum extent,” he said, noting that special focus had been placed on taxpayers, guilds, and small businesses. “It appears the measures taken were effective, and we were able to get through this year with the full cooperation of trade associations.”

Sobhanian stated that there were no protests in markets or among guilds over tax collection. “Our effort has been to minimize bargaining in tax collection by relying on data-based taxation,” he said, adding that extensive meetings had been held with unions, guild representatives, and market traders. “We believe that through dialogue and mutual understanding, tax affairs can be advanced with minimal tension and damage.”

He stressed that despite the country’s particular conditions, tax collection was carried out smoothly in consideration of economic activists, small businesses, and guilds. “What was especially important for us was the smartization of the tax system, which we have pursued in recent years and whose results are now materializing,” he said.

Sobhanian explained that the organization’s recent performance reports reflect the outcomes of this digital transformation. “This does not mean 100 percent satisfaction, but compared to the past, there has been a noticeable change,” he noted. He added that while securing government revenue remains the primary goal, his personal priority is eliminating discrimination and improving tax justice.

The official outlined five major challenges under the traditional tax system, including:

Lack of high-quality and standardized audits due to a mismatch between the volume of tax files and the number of tax officers

Economic unpredictability caused by the heavy role of human discretion

A focus on post-detection enforcement against tax evasion due to structural gaps in the paper-based system

The potential for collusion between tax officers and taxpayers

Complex laws and business diversity that hindered effective auditing

Data-Centered Taxation and Pre-Filled Returns

Under the new system, Sobhanian said, data plays a central role. The administration now prepares pre-filled tax returns rather than leaving taxpayers with a blank form.

“In fact, based on the taxpayer’s own submitted information, a performance report is generated,” he explained. “In many cases, taxpayers approve the pre-filled return. If they do not, taxes are finalized through systemic auditing, and in cases of significant discrepancies, a formal audit will be conducted.”

Sobhanian also reviewed recent legislative developments. The Direct Taxes Law was amended in 2015 (1394 in the Iranian calendar), followed by the approval of the Law on Sales Terminals and the Taxpayer System.

He noted that POS-generated invoices have been extended as electronic invoices through 1405 (March 2027), after initially being scheduled to conclude in 1404.

The deputy economy minister added that value-added tax (VAT) calls under a new framework were approved by the heads of the three branches of government.

According to Sobhanian, the rollout of sales terminal systems has led to significant achievements, including improvements in the business environment and a fairer increase in tax revenues. “This benefits the public, as the government is not relying on inflationary resources to generate income,” he said.

One key indicator of the law’s implementation is the number of taxpayers using electronic invoices. “This year, 1.5 billion electronic invoices have been issued,” he reported.

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President Raisii, who attended the open session of the Majlis in order to present the budget bill, said, “In the fiscal year 1401, the government was able to achieve success with the cooperation of all the concerned and caring people and benefiting from their efforts, thoughts and efforts in the government, parliament and all departments that operate in the name of the holy system of the Islamic Republic.”

The President added, “The first part of the country’s 1402 budget bill, which is related to state-owned companies, was submitted to the Islamic Consultative Assembly one month earlier according to the law so that the parliament has more time to deal with the budget of this part.”

The President stated, “All our efforts were to ensure that the budget bill 1402 was fully in line with the policies announced by the Leader and the policies of the 7th Development Plan,” adding, “Of course, you are aware that the general policies of the 7th Development Plan reached us in mid-September, that is, in the middle of the drafting of the budget bill, but nevertheless, the 1402 budget was inspired by the policies announced by the Leader.”

“After the finalization of the budget bill, the government devoted its efforts to developing the 7th Development Plan so that this plan can be submitted to the parliament as soon as possible,” Raisi said.

The President stated that the government and the parliament will definitely take into consideration how far the past programs have been implemented and what were the reasons for the non-implementation of parts of these programs, and said, “Considering that the evaluations indicate that 30 to 35 per cent of the past programes have been implemented, our focus will be that the 7th Development Plan will be formulated in such a way that it will be fully implemented.”

Referring to the points considered by the Leader in the general policies of the 7th Development Plan, Ayatollah Raisi added, “One of these important points is to separate permanent orders from one-year orders so that businesses become more stable in the coming years and the parliament can review the budget bill easier”.

According to the reports, the government revenues through tax will increase by over 55$ next year comparing to this year’s budget.

Raisi considered the reform of the budget structure as one of the emphasis of the Supreme Leader and a serious necessity of the country and stated, “In the budget bill of 1402, the strengthening of production and employment has been given special attention and 540 trillion tomans for the purpose of investing state companies in the country’s economy and 327 trillion Tomans is also planned as the construction budget of the government”.

He further mentioned the 7% reduction in the tax on production units as well as the reduction in the customs tariff of livestock inputs and basic goods from 4% to 1% as tax incentives foreseen in the budget bill 1402 in order to support production and employment.

The President considered housing as an important concern of the people and their representatives in the Majlis and said, “The government will make the necessary forecasts in next year’s budget in order to provide financial resources to support the construction of housing, as well as provide the necessary credits from the transportation development fund”.

Raisi said, “We thank God that our wise nation disappointed the enemy according to our wise leader and this time, as in the past, the enemies of this nation were defeated in these conspiracies, and of course, our responsibility towards the good, pious, and sincere people who love the Revolution has doubled”.

On this basis, the President pointed out, “All the elements of the system must do their best to serve the people and take steps to solve the problems. We consider ourselves capable of solving problems and we deeply believe in the slogan of “we can” and move things forward with cooperation, empathy, coordination and convergence”.

At the end, Raisi expressed hope that next year’s budget will be the best budget compared to the previous budgets, and by announcing the imminent submission of the 7th Development Plan bill to the parliament, he thanked the people’s representatives, as well as the parliament’s presiding committee and the members of the specialized budget review commissions.

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“The information regarding vacant houses is being sent to Iran National Tax Administration using Multiprotocol Label Switching (MPLS) protocol or manually,” Deputy Transport and Urban Development Minister for Housing and Construction Affairs Mahmoud Mahmoudzadeh told Tasnim.

According to the official, so far, the information related to 1,174,000 vacant houses has been communicated with INTA.

“We are going to also send the data regarding the units owned by legal entities to INTA within one or two days,” Mahmoudzadeh said.

Mahmoudzadeh had previously said that in the first stage of the implementation of the program for collecting tax from the country’s vacant housing units, only units belonging to natural persons are targeted.

The vacancy tax law, as part of Direct Tax Reform Law, was put on the agenda in the Iranian calendar year ending March 2016 and was enforceable from the year ending March 2017, but there was little data on the number of vacant units then, according to Mahmoud Alizadeh, a senior official with the INTA.

The mentioned plan is mainly aimed at lowering the housing rental rate in the country.

In mid-July 2020, the Iranian parliament (Majlis) approved the double-urgency bill of the vacancy tax law and it was decided that the mentioned law would be implemented in July 2021, however, the implementation of the new law was postponed due to technical issues.

Expressing his agreement over the approval of the mentioned plan, Hossein Hossein-Zadeh Bahraini, a member of the Majlis Economic Committee, said, “Our problem in the housing sector is not the demand higher than the supply, while the number of residential units is more than required.”

This plan is vital, as many families are struggling for renting the homes, while there are many empty units, the MP further reiterated.

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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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Gholam-Hossein Shafeie has made the mentioned request on behalf of the country’s private sector which has been negatively affected by the coronavirus pandemic and the U.S. sanctions, the ICCIMA portal reported.

“The country’s private sector, who were already facing major problems due to the international sanctions, have also been facing the challenges resulted from the outbreak of the coronavirus since the previous year,” Shafeie wrote in his letter.

“Due to the outbreak of the disease, the production and service units of the country have repeatedly closed their enterprises or reduced their manpower in order to comply with the safety standards dictated by the National Headquarters for battling Coronavirus, and to maintain the health of their employees,” he added.

Shafeie stated in the letter that the production units’ closures and the reduction of their production capacity have led to a sharp decline in their income and increased their production costs, making it almost impossible for such enterprises to fulfill their administrative and financial obligations on time.

Back in April, Shafeie had written another letter to Rouhani, suggesting ways for supporting domestic production against the economic impacts of the coronavirus pandemic.

In the letter, Shafeie had stressed that the cabinet’s decision to support 10 major business categories did not include the production sector and this sector was largely neglected.

Extension of the tax deferrals offered by the government, returning of at least 50 percent of the value-added tax that exporters paid in the previous year, granting tax exemption or tax reduction of at least 5 percent for the previous year, and extension or renewal of all business licenses without the need to obtain a tax certificate subject to Article 186 of the Law on direct taxes, were some of the supportive measures suggested by the ICCIMA head.

The suggestions also included providing working capital facilities with easy conditions and low rates for those production units and production support services that have been unable to pay their debts and settle their payments due to reduced sales, releasing a part of the deposits that have been blocked in the banks as guarantees and receiving non-cash guarantees by the banks, and obligating the executive bodies to adjust the duration and amount of their contracts with the production units in accordance with force majeure conditions to protect them and prevent them from bankruptcy.

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TEHRAN (Iran News) –Tax reform plans to be revised over massive protests. At least 209 police officers have been injured and 185 activists detained during the two-day protests against a tax reform proposal in Colombia, the country’s police said.

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Omid-Ali Parsa said that the people subject to taxes on luxury cars and houses will be identified by then and this issue will be notified to them.

Speaking on the sidelines of the deregulation board meeting, the official added, “According to the budget law, houses worth more than 100 billion rials (about $2.38 million) will be taxed this year.”

Also, for luxury cars, if the total value of the cars of a person and his/her children under 18 years of age is more than 10 billion rials (about $238,095) it will be subject to tax, he added.

Meanwhile, the deputy transport and urban development minister said last week that the vacancy taxes are planned to be deposited in the National Housing Fund to be allocated for supplying homes for the low-income people.

Mahmoud Mahmoudzadeh said, “The real estate and housing system is a basic measure to identify the housing situation of the country. The goal is not just taxes, but the main program is to identify the living conditions of the households for housing planning.”

Saying that any tax levied on vacant homes goes directly to the National Housing Fund and is used as a facility for the housing of the low-income people, the official said that it is a mistake to think that the government has created this system to increase tax revenues.

In late March, the head of Iran National Tax Administration announced that that the first taxes on vacant houses will be received in the fifth Iranian calendar month of Mordad (July 23 – August 22), and added that this tax will be half the value of the monthly rent of the property.

Parsa had announced in early February that the regulations for the tax on houses and luxury cars would be announced soon, adding that this annual tax has been collected and a heavy fine has been imposed on those who run away from it.

Back in last October, Transport and Urban Development Minister Mohammad Eslami had said that the ministry has referred a list of 194,000 vacant housing units to Iran National Tax Administration to be taxed under the new vacancy tax law.

The minister said that the owners of these houses have been informed in this regard via receiving SMSs.

In September 2020, Mahmoudzadeh had said that in the first stage of the implementation of the program for collecting tax from the country’s vacant housing units, only units belonging to natural persons are targeted.

The Iranian parliament (Majlis) had approved the double-urgency plan of the vacancy tax law in mid-July 2020.

The mentioned plan is mainly aimed at lowering the housing rental rate in the country.

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Now, Trump and his opponent in the November 3 election, Democrat Joe Biden, have to convince Americans they have the best strategy to get the economy back on track.

Here is a look at how the candidates want to revive the economy:

Since the COVID-19 outbreak, Trump has signed legislation to flush the economy with trillions of dollars in one-time aid to businesses, individuals, and local governments.

The president has also encouraged states to reopen as quickly as possible even as his health advisers warn there could be a net increase in infections. Allowing businesses to operate again could reduce the need for more direct payments to individuals and companies hit by the shutdown.

Biden has cautioned against reopening the economy without first ramping up testing for the coronavirus. The former vice president, who oversaw US stimulus spending after the 2008 financial crisis, says households – as well as state and local governments – need more economic support to get through the shutdown.

While Trump has said further stimulus measures must include a payroll tax cut, Biden wants Washington to offer states more support in paying for unemployment benefits.

The president, a former real estate developer, has touted the 2017 tax cuts he signed into law as an example of his approach to stimulating economic growth. Cutting payroll taxes would boost the paychecks of most working Americans.

Biden has criticized the 2017 tax cuts as giving too many benefits to the wealthy and to corporations. He has pledged to reverse some of those cuts, raising the marginal tax rate on the highest income earners back to 39.6%, from 37%, while also lifting some investment profit taxes. He also supports raising the federal minimum wage to $15 an hour from $7.25 and expanding some tax credits for lower-income workers.

“We have to build a much more inclusive, much more equitable middle class and an economy that everybody – everybody – gets a fair shot at,” Biden said at a campaign event on April 28, Reuters reported.

Trump allies have said they will attack the policy of raising taxes while the economy struggles to recover.

In a return to a core issue of his 2016 presidential campaign, Trump is telling voters he wants to boost domestic manufacturing. He has recently stepped up verbal attacks on Beijing as his administration accelerates an initiative to remove industrial supply chains from China.

He has also argued that America’s difficulties in procuring medical supplies internationally during the pandemic are another reason to encourage US companies to avoid offshoring.

“If one thing comes out of this, more than anything else, is that we should make the product in the United States,” Trump said during an April 19 press briefing.

As a US senator, Biden voted for the North American Free Trade Agreement, a trade pact that helped Mexican factories gain access to the US market.

Biden has criticized Trump’s tariff war with China as bad for US consumers and farmers and in 2018 he called for “retaliation” on countries like China which he has said subsidize industries and allow intellectual property theft.

Biden wants Washington to help foster domestic production of electric vehicles, a contrast with Trump who has signaled a little appetite for a “green” infrastructure program and advocates more spending on US roads, bridges and airports.

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TEHRAN (Iran News) – An Iranian economist said the country can count on a maximum of $20 billion in annual tax revenues despite claims that the government would fail to pocket around $14 billion worth of taxes to finance its budget in the next Iranian calendar year beginning on March 20.

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