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The government could see a decline of 400 trillion rials ($2.46 billion) in tax revenues as a result of the new coronavirus disease, COVID-19, if the economic effects of the pandemic on businesses go away within the next couple of months, Omid Ali Parsa, director of Iranian National Tax Administration says.
“Numerous aspects of the coronavirus crisis on different economic sectors are not clear so it is not possible to estimate tax revenues to be gained from each tax base,” Fars News Agency quoted him as saying.
“But what is patently clear is that business owners pay taxes on the profits of their businesses; you can’t tax them when they haven’t made any profits.”
According to the INTA chief, under the best-case scenario, 1,400 trillion rials ($8.64 billion) out of 1,800 trillion rials ($11.11 billion) set in the budget law for tax revenues in the current year (March 2020-21) should materialize, if efforts to contain the economic impacts of the virus prove to be effective by the end of spring (June 20).
Parsa noted that tax revenues increased by 31% in the last fiscal year (March 2019-20) compared with the year before to reach 1,430 trillion rials ($8.82 billion).
The share of taxes in budget increased from 37% in the fiscal 2018-19 to 54% last year, Mehr News Agency quoted him as saying.
“The average growth in tax revenues over the past five years was 21%,” he added.
Parsa noted that value added tax gains hit 250 trillion rials ($1.54 billion) during the period.
