Iran's Budget Deficit Doubles; CBI Report for First 5 Months of Current Fiscal Year Shows
EghtesadOnline: Iran’s budget deficit came in bigger than expected in the first five months of the current fiscal year (March 21-Aug. 22) to reach 369.1 trillion rials ($2.49 billion), latest data released by the Central Bank of Iran show.
The shortfall for the period was larger than the budget law’s forecast of 137 trillion rials ($925.67 million) for the five-month period.
The deficit is 102% higher than that of the preceding year’s corresponding period.
To cover the shortfall, the government sold 71.7% more bonds during the period compared with last year similar period—a total of 397.1 trillion rials ($2.68 billion), according to Financial Tribune.
The government’s overall revenues during the five months amounted to 290.4 trillion rials ($1.96 billion), indicating a rise of 1.5 % year-on-year, while spending hit 659.5 trillion rials ($4.45 billion) to register a 40.6% growth YOY.
Revenues associated with the sales of oil and petroleum products were more than the projected budgetary figure of 429 trillion rials ($2.89 billion). They reached 538.8 trillion rials ($3.64 billion), indicating a 62.4 % rise YOY.
The government spent 249.1 trillion rials (about $1.68 billion) on development projects in the five-month period, which is lower than the target set in the budget law for current year’s first five months: 263.3 trillion rials ($1.77 billion).
Tax revenues were estimated to hover around 603.3 trillion rials ($4.07 billion), but they reached 429.4 trillion ($2.9 billion), registering a 16.8% increase YOY.
The government’s tax revenues consist of returns from direct and indirect taxation. Direct taxes include three groups of “tax on legal entities”, “income tax” and “wealth tax”.
Overall, direct tax revenues stood at 190.4 trillion rials ($1.28 billion) during the five months, registering a decline of 3.4% YOY.
Indirect taxes, including “tax on imports” and “tax on goods and services”, reached 239.0 trillion rials ($1.61 billion), indicating a 40.2 % rise YOY.
The report also shows tax on imports generated 63.5 trillion rials ($429.05 million), 88.7% more than in the year before while tax on goods and services earned the government 175.5 trillion rials ($1.18 billion), up 28.3% YOY.
Value added tax, which is a subcategory of tax on goods and services, increased by 11.9 % to reach 110.2 trillion rials ($744.59 million).