Oil revenues only go to development sector in next year's budget

October 1, 2019

TEHRAN – Iran is going to allocate all revenues from oil sales to the development projects following structural reforms in the next Iranian calendar year’s (March 2020-March 2021) budget bill, IRIB reported on Monday, quoting the head of Planning and Budget Organization (PBO) as saying.

Oil revenues are generated from selling the country’s capital assets and should be spent on augmenting capital assets such as development projects, Mohammad Baqer Nobakht said.

Noting that current expenditures from oil revenues will be cut to zero in the next year’s budget, the official said, “The number of provincial development projects has increased from 76 to 86 over the past couple of years, indicating that new projects have been initiated before the completion of the old ones.”

“The disproportionate rise in the number of development projects will be avoided, as per the reforms undertaken in next year’s budget.” he added.

According to the official, the revenues gained from elimination of hidden energy subsidies as well as increased tax incomes will replace oil revenues. 

“This does not mean a rise in tax income; but by setting new tax bases and eliminating unnecessary exemptions at a time of economic warfare, more tax revenues will be provided,” he explained.

Back in September, Nobakht had announced that the government was going to submit the budget bill for the next Iranian calendar year (starts on March 20, 2020) to the parliament on December 6 as scheduled.

According to the official, this year, PBO has decided to send the information about the state-owned companies’ budget to the Majlis (Iranian parliament) a month earlier so that the parliament would have enough time to review it.

The members of the budget preparation committee at PBO are seriously working on the bill and while the views may differ in some areas, the consensus among all members will be the base for the final decision making, Nobakht said.

EF/MA

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