Iran’s 1404 Budget: Economic Crisis and Population Exploitation

The Iranian regime’s 1404 budget reflects deep economic distress, imposing a 53% increase in taxes and fees to sustain operations amid international sanctions and inflation. This budget prioritizes military and ideological expenses over public welfare, exacerbating hardships for citizens, particularly the impoverished. As financial pressures intensify, public discontent and potential unrest are likely to grow.

The Iranian regime’s budget for 1404 (March 2025 – March 2026) underscores its dire economic situation, as it employs substantial tax hikes, increased fines, and elevated service fees to mitigate its fiscal shortcomings. This strategy comes amid tighter international sanctions, rampant inflation, and diminishing oil revenues. Under the leadership of Masoud Pezeshkian, the government is extracting funds from its citizens, with a staggering 53% increase in taxes coupled with continued high spending on militaristic and ideological agendas.

The government projects an ambitious 2084 trillion tomans in tax revenues, reflecting a 53% surge from the previous fiscal year. This includes a 73% rise in corporate taxes, a 68% increase in personal income taxes, and a 22% uptick in consumption taxes, all contributing to elevated costs for the populace. Although the regime claims these hikes aim to mitigate the budget deficit and curb inflation, state media recognizes underlying economic mismanagement as a core issue.

A report from Jahan-e Sanat indicates that Iran operates without a functional budgeting framework, relying instead on optimistic revenue forecasts while grappling with fixed expenses. This inconsistency reveals the regime’s flawed approach, as it banks on considerable tax income despite an increasingly failing economy, while ensuring substantial allocations for military and ideological expenditures persist.

The budget’s reliance on volatile currency exchange rates exacerbates living costs for the average Iranian, as it assumes an exchange rate of up to 75,000 tomans per USD. Experts note that ongoing sanctions impede the regime’s access to oil revenues, putting fiscal projections at further risk. Such instability is poised to elevate living costs, making essentials increasingly unaffordable for many.

As traditional revenue streams dwindle due to sanctions, the regime has resorted to aggressive financial tactics, including extracting funds from marginalized groups and escalating fees significantly. This includes a staggering 500% increase in residency service fees primarily affecting foreign nationals, particularly Afghan migrants, and massive hikes in fines for traffic violations and service fees, which collectively deepen public dissatisfaction as inflation outpaces wage growth.

Further measures include increased costs for education and vocational registration, sharply rising vehicle registration fees, and new exit taxes designed to burden travelers and tourists, thereby prioritizing revenue for religious sites over improving economic conditions. These strategies illustrate the regime’s tendency to shield its military and ideological expenditures while imposing austerity measures on the populace.

In conclusion, the Iranian government’s 1404 budget suggests a continued dependence on severe economic exploitation of its citizens to sustain a regime that remains indifferent to the burgeoning hardship faced by the Iranian populace. Worsening inflation and a lack of substantive economic policies will inevitably contribute to rising inequality and intensified public resentment toward the government.

The Iranian 1404 budget highlights a severe economic crisis, as the regime imposes drastic tax hikes and fee increases to sustain its operations while providing limited relief to its citizens. The regime’s heavy spending on military and ideological concerns amidst rampant inflation predominantly affects the populace, exacerbating hardships and fueling potential dissent. As financial pressures mount, the long-term implications for social stability and economic prosperity appear increasingly bleak.

Original Source: www.ncr-iran.org