Iran’s 2016-17 Budget Cuts Cash Subsidies As Deficit Looms

Iran’s Guardian Council has finally given its green light for 2016-17 Iranian budget (year beginning 20 March 2016), after ruling in favor of parliament’s decision to cut the number of “wealthier” Iranian recipients of the cash subsidies paid by the state. The council, a constitutional watchdog, twice returned the draft budget bill to parliament for revision before final approval, causing a delay which was partly due to the disagreement between the legislature and the government over reducing the number of recipients of the cash subsidies (MEES, 6 May).

Against strong objections from the government to reduce the number of recipients, parliament amended the budget bill in early April, recommending the canceling of monthly cash subsidies of IR 450,000 around $12 per person at the market exchange rate of $1 = IR 35,000 to better-off Iranians. The parliament’s rationale here was the need to cut government spending at a time of depressed oil prices and revenue and use the savings from cash subsidies on boosting employment.


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