Iran’s 1404 budget reflects economic desperation, featuring a 53% tax increase and soaring service fees as the regime seeks to fund military and ideological expenditures amidst growing financial challenges. Key changes include significant hikes in corporate and personal income taxes, along with fees targeting foreign nationals and travelers, exacerbating inflation and impoverishing the population while neglecting their welfare.
The Iranian regime’s budget for 1404 (March 2025 – March 2026) showcases significant economic distress, characterized by heightened taxes, increased fines, and soaring service fees aimed at addressing an ongoing financial crisis exacerbated by international sanctions. Under the leadership of Masoud Pezeshkian, the government has opted to burden its citizens as a monetary source, implementing a staggering 53% rise in tax revenues, while still allocating substantial funds to military and security forces.
The official budget proposal indicates a projection of 2084 trillion tomans in tax revenue, representing a notable 53% increase from the previous year. In line with current market conditions, one U.S. dollar is equivalent to 89,100 tomans. This significant tax increase encompasses a 73% rise in corporate taxes, a 68% jump in personal income taxes, and an increase of 22% in consumption taxes, all further eroding the financial well-being of the populace.
Despite the regime justifying these tax increases as a measure to reduce the budget deficit and curb inflation, state media has pointed to governmental mismanagement and corruption as the fundamental issues. Reports emphasize that Iran lacks a cohesive budgeting system, operating instead under an uncoordinated collection and expenditure framework that assumes high tax revenues while guaranteeing relentless spending on military and ideological ventures.
Moreover, the budget’s strategy reflects a dangerously devalued currency, with a projected exchange rate of 75,000 tomans per U.S. dollar. As oil revenue projections appear overly optimistic, experts highlight the critical vulnerability of this budget to external factors such as sanctions and Iran’s current foreign policy. This reliance on unstable currency depreciates the cost of living, significantly affecting the ability of ordinary Iranians to afford basic necessities.
To generate revenue amid tightening sanctions, the regime has resorted to targeting its own citizens through various means. This includes exorbitant fees for residency services on foreign nationals, alongside substantial increases in traffic fines and service fees, which are projected to raise trillions of tomans. The consequences of sustained inflation exceeding 40% over the past decade reveal a trend of growing discontent as government actions appear indifferent to the financial struggles of everyday citizens.
Increases in education and vocational fees further exemplify the government’s strategy to extract revenue from struggling families, as registration fees for exams and fines for university dropout rise drastically. New discriminatory pricing for vehicle registration and licensing, particularly affecting lower-income individuals reliant on second-hand imports, also reveals deepening economic divides.
Finally, significant fee increases targeting travelers further indicate a prioritization of religious institutions over economic growth. With exit taxes for Iranians and a new tourism tax imposed on foreign visitors aimed at financing religious sites rather than supporting broader infrastructure, the government’s fiscal policies directly reflect an ethos of austerity for the populace, while military and ideological expenditures remain untouched. This situation fosters growing resentment, as the regime continues to extract resources from citizens who are already deeply affected by ongoing inflation and economic challenges.
The Iranian government’s budget for 1404 highlights its reliance on increasing financial burdens on the populace to fund a regime characterized by military and ideological priorities. With drastic tax hikes, excessive fines, and increasing service fees, the economic strain on ordinary Iranians intensifies. Furthermore, the regime’s inability to address fundamental economic mismanagement only amplifies public discontent, creating a volatile atmosphere ripe for future unrest. As living conditions deteriorate, the disconnect between governmental priorities and the needs of the populace continues to deepen.
Original Source: www.ncr-iran.org
