EghtesadOnline: Iran’s budget deficit came in bigger than expected in the first nine months of the current fiscal year (March 21-Dec. 21, 2018) to hit 451.1 trillion rials ($3.8 billion), latest data released by the Central Bank of Iran show.
The shortfall, which was larger than the budget’s forecast of 243.9 trillion rials ($2.05 billion) for the nine-month period, registered an increase of 17% and 5.7% compared with the same period of last year and the eight-month period’s figure, respectively.
The eight-month budget deficit (March 21-Nov. 21, 2018) stood at 426.5 trillion rials ($3.6 billion), 7.8% higher year-on-year.
To cover the deficit, the government sold 8.7% more bonds—a total of 653.7 trillion rials ($5.52 billion)—in the nine-month period year-on-year, Financial Tribune reported.
The government’s overall revenues during the nine months amounted to 575.8 trillion rials ($4.86 billion), indicating a rise of 69.2% year-on-year, while its spending hit 1,026.9 trillion rials ($8.67 billion) to register a 41.5% growth YOY.
Revenues associated with the sales of oil and petroleum products were more than the projected budgetary figure of 763.8 trillion rials ($6.45 billion.) They reached 894.2 trillion rials ($7.55 billion), indicating a 39.8% rise YOY. The budget law estimate of revenues from sale of oil and petroleum products for the whole year is at 1,010.1 trillion rials ($8.53 billion.)
The government spent 321 trillion rials (about $2.71 billion) on development projects during the nine months under review, posting a 6.2% growth YOY, lower than the target of 468.8 trillion rials ($3.95 billion) set in the budget.
As per the budget, the government is required to spend a total of 620 trillion rials ($5.23 billion) on development projects this year.
Tax revenues were estimated to hover around 1074.3 trillion rials ($9.07 billion), but reached 771.2 trillion rials ($6.51 billion), registering a 12.8% increase YOY.
The budget law estimate of tax revenues for the whole year is 1,420.8 trillion rials ($12 billion.)
Eight-month tax revenues stood at 671.1 trillion rials ($5.66 billion), registering an 11.7% 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 366.5 trillion rials ($3.09 billion) during the nine months, registering an increase of 9% year-on-year.
Tax on legal entities yielded 208.9 trillion rials ($1.76 billion) for the government, 1.7% more than the same period of last year. The nine-month objective stated in the budget for tax on legal entities was 307.3 trillion rials ($2.59 billion.)
The government collected 131.2 trillion rials ($1.1 billion) from income tax and 26.4 trillion rials ($222.97 million) from wealth tax, which show a respective growth of 17.8% and 35% over last year’s corresponding period.
Indirect taxes, including “tax on imports” and “tax on goods and services”, reached 404.7 trillion rials ($3.41 billion), indicating a 16.5% rise YOY.
The report also shows tax on imports generated 99.4 trillion rials ($839.52 million), 14.1% more than the year before while tax on goods and services earned the government 305.3 trillion rials ($2.57 billion), up 17.3% YOY.
Value added tax, which is a subcategory of tax on goods and services, increased by 17.6% to reach 191.8 trillion rials ($1.61 billion.)
During the period, the government earned 7.3 trillion rials ($61.65 million) from departure tax, which it charges outbound tourists. The figure indicates a rise of 171.9% compared with the same period of last year. The budget target set for the current year’s revenues from departure tax is 8 trillion rials ($67.56 million.)
The government earned 3.8 trillion rials ($32.09 million) from tax on cigarette sales in the nine-month period of the current year. The figure indicates a rise of 35.6% compared with the same period of last year.
The budget target set for the current year’s revenues from tax on cigarette sales is 5.3 trillion rials ($44.76 million).