Value Added Tax Rate Increased to 10% in 1403

The Tax Affairs Organization announced in a statement that the value-added tax rate will increase from 9% to 10% in the year 1403. The statement mentioned that the goal of increasing the VAT rate is to secure the necessary resources for equalizing the pensions of military, civil retirees, and the Steel Fund. Meanwhile, Mohammad Hossein Farhangi, a member of the Islamic Consultative Assembly, criticized the proposal for a one percent increase in tax, stating, 'In essence, we are taking the value-added tax from the retirees themselves and then giving it back to them.' Previously, three teachers' associations in Iran had issued a critical statement saying that 'linking the payment of salaries and credits for equalizing retirees' pensions and the continuation of teachers' ranking to the increase of one percent in VAT is putting the government's biggest promise on hold.' Economic journalist Reza Ghaibi emphasized in an interview with VOA that 'with the approval of the one percent increase in VAT, retirees and other people will continuously pay this one percent as consumers.' According to the Tax Affairs Organization's announcement, suppliers of goods and services subject to this law must include the 10% VAT in invoices and collect it from buyers starting from the beginning of 1403. Meanwhile, a member of the union of restaurants and traditional tea houses in Shiraz reported citizens' dissatisfaction with this tax. Ali Akbar Ghavi-Panjah, in Esfand of this year, described the VAT as a 'double calamity' and stated that citizens do not relate to this tax. Several experts have pointed to factors such as an unbalanced and ambiguous budget, rising taxes, a novice parliament, restrictions on importing raw materials, escalating regional tensions, and the U.S. elections as issues that cast doubt on the outlook for Iran's economy in 1403. The inflation puzzle; a 35% inflation forecast for food products in the new year. The Central Bank is preparing for a 'hard year'; economic activists reported currency rationing. The autumn of jobs in the spring of inflation; restaurant owners are on the brink of bankruptcy. Tax disputes in the media; 'Ilna' criticized the low taxes of gold sellers and real estate brokers.