Iran’s 1404 budget reflects severe economic challenges, with aggressive tax increases and service fees to secretly fund state military and ideological programs. Proposed revenue sources include exorbitant hikes in corporate and personal taxes, increases in fines and fees that disproportionately affect lower-income families, and targeted measures against foreign nationals. Inflation and currency instability will compound the financial strain on ordinary Iranians.
Iran’s 1404 budget for the period of March 2025 to March 2026 reveals a dire economic situation, with the regime enforcing steep tax increases, elevated fines, and soaring service fees to counteract its financial crisis and international isolation. As a result of intensified sanctions and reduced oil revenue, the Iranian government, led by Masoud Pezeshkian, is targeting its own population to generate revenue, implementing a 53% tax hike while still heavily investing in military and ideological initiatives.
The proposed budget anticipates tax revenues of 2084 trillion tomans, which represents a significant 53% rise compared to the previous year. Specifically, this budget reflects exorbitant increases in various tax categories: a 73% rise in corporate taxes, a 68% increase in personal income taxes, and a 22% increase in consumption taxes. The regime defends these hikes, claiming they will mitigate the budget deficit and curb inflation, despite acknowledgment of corruption and mismanagement as underlying issues.
Moreover, the budget assumes a downvaluation of the national currency to around 75,000 tomans per U.S. dollar. Experts predict that sanctions will greatly hinder Iran’s ability to capitalize on oil revenues projected at $70 per barrel, raising concerns about potential fiscal shortfalls. This currency instability is likely to exacerbate the cost of living crisis, making essential goods increasingly unaffordable for the Iranian public.
In response to blocked traditional revenue streams, the government is taking drastic measures to extract money from various sources including:
1. Targeting Foreign Nationals – There are staggering fee increases for residency services and travel permits, and a projected revenue from deporting migrants, highlighting the regime’s prioritization of ideological allies over humanitarian considerations.
2. Traffic Fines & Service Fees – Traffic fines have seen a 60% rise and passport fees have surged by 50%, while the government forecasts that these measures will generate substantial revenue.
3. Education and Exam Fees – Fees for educational exams and fines for university dropouts are set to increase significantly, which will disproportionately burden lower-income families already grappling with inflation.
4. Vehicle Registration Fees – The budget introduces a pricing disparity for registering vehicles, with enormous hikes for imported vehicles impacting lower-income families reliant on these modes of transport.
5. Exit Taxes and Tourism Fees – Increased exit taxes and a new “tourism tax” reflect a continuing focus on religious funding rather than economic growth, channeling revenue to Mashhad’s religious sites instead of infrastructure or tourism improvements.
These measures underscore a system where the economic burden is shifted onto the population while ensuring military and religious factions remain financially stable. As inflation continues to rise, the financial strain on the populace intensifies, potentially igniting further dissent against the regime’s practices.
The Iranian 1404 budget illustrates the regime’s economic struggles, resorting to severe taxation and fees aimed at sustaining military and ideological spending while failing to address mismanagement and corruption. With expectations of continued inflation and increased living costs, the government’s reliance on extracting revenue from the populace may further fuel public discontent and opposition. As essential goods become less affordable, social unrest could become a more pressing issue for the regime to confront.
Original Source: www.ncr-iran.org
