Iran's Government Faces a Budget Deficit of 10 Trillion Tomans in the First Nine Months of This Year

The Central Bank's report on the government's financial situation for the first nine months of this year indicates that Hassan Rouhani's government has experienced a budget deficit of 10,753 billion tomans during this period. The report, published on Friday, shows that the government had revenues of 63,781 billion tomans, while its current expenditures amounted to 101,164 billion tomans, resulting in an operational budget deficit of 38,442 billion tomans. In terms of capital assets, the transfer of capital assets, primarily from oil revenues, reached 51,231 billion tomans in these nine months. During the same period, the acquisition of capital assets or construction payments amounted to 23,542 billion tomans, leading to a net transfer of capital assets of 27,689 billion tomans. Consequently, the operational and capital balance, derived from the total operational balance and the net transfer of capital assets, indicates that the budget balance over the past nine months has been negative by more than 10,753 billion tomans, referred to as a budget deficit. However, the actual current expenditures of the government in these nine months, when compared to the ceiling of current expenditures set in this year's budget law, show that the government managed to save 10 trillion tomans from its current expenditures. The ceiling for current government expenditures for the year 1393 (2014) is set at over 148 trillion tomans. If we consider equal monthly expenditures for the entire year, the government could have spent 111 trillion tomans in these nine months, while the report confirms that current expenditures reached 101,164 billion tomans. In these nine months, the government allocated 23.5 trillion tomans to construction projects, experiencing a 162% increase compared to the allocated construction budget in the same period last year. The projected ceiling for the construction budget in this year's budget law is 43,972 billion tomans, meaning the government should have allocated about 33 trillion tomans to construction projects on average in these nine months, but the actual allocation was about 10 trillion tomans less than this figure. An examination of the government's tax revenue items indicates a shortfall of 4,800 billion tomans in tax revenues during this period. The budget law for the year 1393 set the tax revenue figure at 70,254 billion tomans. Therefore, on average, the government should have achieved 52,690 billion tomans in tax revenue over the past nine months, but the actual tax revenue reached 47,872 billion tomans by the end of Azar. This figure represents a 52% increase compared to the tax revenues of the government in the same nine-month period last year. The decline in oil prices in recent months is one of the main reasons for the failure to achieve the projected revenues in the budget. The calculated price of each barrel of oil in the budget law for the year 1393 is set at 100 dollars, but in recent months, with the drop in oil prices fluctuating around 43 dollars per barrel, the projected revenues of the eleventh government will not be realized. In the budget proposal for the upcoming year, currently under review in the Budget Integration Commission of the Islamic Consultative Assembly, the calculated price of each barrel of oil is set at 72 dollars, which is expected to be calculated based on each dollar being 2,850 tomans for the allocable rial revenues in the Iranian economy. Given the decline in oil prices, some members of parliament have mentioned the need to change the calculated oil price in the budget proposal for the next year. Ali Taebnia, Iran's Minister of Economic Affairs and Finance, has also emphasized that the government has three different scenarios for the budget for the upcoming year with varying oil prices.