Iranian Economy Minister forecasts $11.28 billion deficit in current year’s budget

Iran Materials 28 October 2013 13:36 (UTC +04:00)

Azerbaijan, Baku, Oct. 28 /Trend, N. Umid

Iranian Economy Minister Ali Tayyebnia has forecast some 280 trillion rials, about $11.28 billion based on the official rate of 24,820 rials per USD, deficit in the current year's budget despite the revision, Iranian Jahanesanat newspaper reported.

He went on to note that the country will be facing a budget deficit even if the construction projects are halted and debts to contractors not paid.

This is while, Iran's Vice President for Supervision and Strategic Affairs, Mohammad Baqer Nobakht earlier announced that if the current year's budget's revision bill is approved by the Iranian parliament, the administration will not face a budget deficit.

On October 23, the Iranian parliament approved the general outline of the current year's budget bill amendment.

Parliament approved the current year's 7.270 quadrillion rials budget bill which is about $293 billion based on the official USD rate.

The Iranian parliament and administration have agreed to finalise cutting cash subsidies of some high-income Iranian families by the end of the current fiscal year (March 2014).

On October 20, the budget and planning committee of the Iranian parliament approved cutting cash subsidies of rich families.

On October 13, the website of the Iranian parliament quoted MP Abbas Rajaee as saying that more than 30 per cent of cash subsidies which are paid to people in Iran, should be cut.

Through cutting cash subsidies for high income earners, the budget deficit can be fixed, he added.

Paying cash subsidies to people is poisonous for the national economy, he said. Cutting subsidies of all but villagers and pensioners and those who are under coverage of welfare organisations will not be problematic, he explained.

The subsidy reform plan pays 45,500 rials (about $18) to Iranians, eliminating subsidies for fuels and some commodities.