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Iran exempts railway transport services from VAT

Politics Materials 8 October 2018 15:03 (UTC +04:00)
Iran exempts railway transport services from VAT

Baku, Azerbaijan, Oct. 8

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The decision to cancel a 9-percent VAT for passenger and freight railway transportation in Iran should be implemented, Saeed Rasouli, a board member of the Islamic Republic of Iran Railways (RAI), said at a press conference, IRNA reported.

Accordingly, the money paid beforehand should also be refunded, he noted.

Rasouli said that fortunately, at the meetings with the relevant circles, paragraph B of the Article 52 of the 6th Development Program on Railway Companies was executed.

Railway companies’ value added tax is calculated at 0 percent based on the 6th Development Program Act, and the value added tax of railway companies should be calculated from the date when this law enters into force, he noted.

Meanwhile, a member of the RAI Supervisory Board commented on the allocation of 1 percent of Iran’s oil and gas sales revenue to the development of the railway transport industry.

Despite the existence of a revenue forecast envisaged by the legislation in the 6th Development Program, no funding has been allocated for this sector so far and the RAI hasn’t received any funds, he noted.

There is a difference between no taxation at all and a 0 percent tax calculation, he said. Governments always try to reduce taxes, he noted, adding that however, the legislation may change the 0 percent taxation when necessary.

The railway industry doesn’t compete with highway transportation, Rasouli said. On the contrary, collaboration between these two sectors is essential for the joint transportation to come true, he noted.

He added that expenditures of the railway companies have decreased by 9 percent.

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