Dalga Khatinoglu, Trend Agency's Iran News Service Chief/
Seyed Shamseddin Hosseini, Irani Minister of Economic Affairs and Finance announced that Iran is planning to fight against sanctions, imposed on Iranian oil incomes by the Western countries. He said oil revenues cut could be compensated by tax, IRIB reported.
Two days before Hosseini's statement, Oil Minister Rostam Qasemi said within his recent trip to the United Arab Emirates on Oct 23 that if the West intensifies sanctions against the Islamic Republic, the country will shut down its oil exports.
Iranian Supreme Leader has called several times the government on planning a "resistance economy" in sanction conditions due to Iran's nuclear program. Hosseini says that for launching resistance economy, Iranian government incomes structure should be redefined.
Oil and oil production revenues make up about a half of Iranian yearly budget, which is $5.660 trillion rials (about $449 billion based on official USD rate in Iran). According to Hosseini's statement, the share of tax incomes in government's revenue is 43 per cent.
The industry sector brings a huge amount of paid tax, but during current year, this sector faced significant problems because of sanctions and lacking liquidity.
For instance, in August, the Association of Iranian Carmakers announced that car output fell by 36 per cent during the first quarter of the current calendar year (began on March 20) compared to the same period last year.
In other industry sectors, the situation is similar. Reportedly, thousands of workers have been fired, because firms, fabricates and companies work with half capacity or are shut down. On the other hand, increasing unemployment means decreasing taxes. This is why, replacing more than 110 billion petroleum incomes with tax seems very difficult.
The deputy director of the State Tax Affairs Organization Mohammad-Qasem Panahi stated on September 26 that Iran's direct and indirect tax incomes totalled 141 trillion rials (only some $11.5 billion) during the first five months of the current Iranian calendar year.
On August 10, the State Tax Affairs Organisation's director Ali Askari said that the current year's budget law has envisaged earning 340 trillion rials (some $27.7 billion) as tax income.
According to the latest report of the International Energy Agency, which was published on October 12, Iran's crude oil exports and output stood at respectively 860, 000 barrels and 2.63 million barrels per day in September, compared to 2.4 million barrels of oil exports and 3.68 million barrels per day last year. This means, Iran lost about two third of oil export revenues during current year, which was $114.76 billion in 2011. Last year, Iran's total exports were 130.54 billion, this means the bulk of Iran's export income relies on petroleum and oil production revenues.
According to OPEC statistics, in 2011, Iran's daily oil refinery capacity was only 1.772 million barrels, and in case Iran cuts oil crude export, it will reduce oil output to 858,000 barrels per day. This means Iran should shut down some of its oil fields and close the wells. Regarding the fact that almost 80 percent of Iran's oil fields are in their second half-life, cutting oil extraction may lead to their inactivation and revival of shut down wells would be very difficult. This decision would seriously damage Iran's oil industry.