The governor of Iran’s National Tax Administration (INTA) Mohammad-Hadi Sobhanian has ordered the execution of a new law which significantly cuts the Value Added Tax (VAT) on imports of essential goods.
Mohammad-Hadi Sobhanian called on the directors of INTA local officials across the country on Saturday to execute provisions of a new paragraph which has been added to Act 6 of Iran’s this year budget law.
The new paragraph exempts the imports of essential medicine and pharmaceutical items from VAT payments, reducing the payments to as low as 1% for imports of other essential goods such as wheat, rice, oil seeds, different unprocessed oils, all types of beans, sugar, chicken meat, red meat and tea.
Under the pressure of tough Western sanctions, Iran has been trying to cut reliance on oil revenues and increase its tax income.
The country has, however, exempted essential goods from increased taxes to protect the less privileged classes of the society.