Large number of Iranians should be removed from subsidy receivers list

Business Materials 5 May 2015 16:42 (UTC +04:00)

Baku, Azerbaijan, May 5

By Fatih Karimov - Trend:

A large number of Iranians should be removed from the list of cash subsidy receivers, said Iranian Government Spokesman Mohammad Baqer Nobakht.

Considering the decline in the oil price, revenues are expected to reach $12.5 billion, Nobakht said.

"So, we will face budget deficit and we should remove a large number of people from receiving cash subsidies," Iran's Tasnim news agency quoted Nobakht as saying on May 5.

According to the budget law for the current Iranian fiscal year, which began on March 21, half of revenues from implementing the subsidy reform plan should be paid to people in cash, 30 percent should be paid to the production sector, and 20 percent should be spent on development projects, Nobakht explained.

Some $15 billion was paid in cash subsidies to Iranians in the past Iranian fiscal year, he noted.

In February, Nobakht said that the Iranian government is taking measures to stop monthly cash subsidies from being paid to rich and overseas Iranian nationals.

Withholding the subsidies of high-income households has been on agenda for a few months, but there was no necessity to break the news to the public, Nobakht said.

The subsidy reform plan, which was called "the biggest surgery to the economy", was put into operation in September 2010.

According to the plan, the subsidy on food and energy is removed gradually, and the government allocates a portion of the amount saved to people and industry.