How does the main hidden tax burden the people?
According to Iran Gate’s report, the tax collection rate from the people has significantly increased under the Rouhani government. However, the point here is that Rouhani not only directly increases the direct provincial taxes but also secretly collects taxes from various citizens, which the people are not directly aware of.
Iran Gate has addressed the issue of hidden taxes in a two-part dossier. This second part explains four other methods of collecting hidden taxes. In the previous part, we discussed inflationary taxes and oil taxes, and their details were explained to the audience. In this part, we focus on communication taxes, market taxes, population taxes, and savings taxes.
Internet hidden tax
Internet users in Iran, due to the fact that the Rouhani government has filtered all social networks, are forced to pay an additional cost besides the traffic cost they pay. Interestingly, this cost, which is mainly received through the purchase of a filter breaker or VPN, indirectly goes into the government’s pocket.
In fact, the main government not only greatly restricts the free flow of information and access to the internet through widespread filtering of social networks, but also profits greatly from this. Although the government does not directly receive this income, there are numerous companies, mostly claiming to be knowledge-based, that act as intermediaries and sell VPN services. These companies are usually connected to Ibrahim Raisi, the president, and senior officials of the government.
One of the most well-known examples that has been discussed on social networks is a company called Betternet, which is owned by Anisieh Khazali, the deputy of Seyyed Ebrahim Raisi. This company, registered in Canada, is essentially the creator and seller of circumvention services in Iran, and many Iranian users use it to bypass extensive restrictions in the virtual space.
In other words, the cost that every Iranian user pays on a monthly and regular basis to buy a VPN is a type of tax imposed on them by the government. There is no accurate estimate of the financial turnover of the VPN market in Iran, but it is estimated to have a turnover of over 6 trillion tomans per year, which is astonishing and unprecedented in its kind.
Tax Market
Automobile, electronics, household appliances, gold, coins, and all are subject to some form of direct and indirect taxation. If we overlook the recent intensification of direct taxation in these markets, we can clearly see the footprint of hidden taxation in these markets. In the automobile and motorcycle market, it has been repeatedly mentioned that the price of low-quality domestic products is about 3 to 4 times the international price of cars.
This 400% difference is actually a hidden tax that the government of Ibrahim Raisi receives from the people in return for the monopoly it has created. Before Raisi’s government, this price gap between domestic production and global markets was about 200%, but with the arrival of the thirteenth government and the slogan of supporting domestic production, the price gap became much deeper.
The same policy can be seen in the import of products such as mobile phones. Some brands, like Apple, not only face the mentioned price gap, but users also have to pay a significant amount as a phone registration fee to the government, which is essentially considered as a luxury tax by the government. It should be noted that the import of mobile phones, both legal and smuggled, is mainly done by military institutions in Iran. When the government imposed a ban on the import of Apple products, the profit margin of importing these products increased dramatically.
Currently, the latest model of Apple phones is traded in global markets for about $900, which would be around 40 million tomans considering the free market exchange rate. However, if someone wants to purchase and use the same device within the country, they would have to pay an amount between 130 to 140 million tomans, which includes the registration fee.
Hidden population tax increase
The main government has placed the Youth Law at the forefront of its programs from the beginning. This law has imposed significant costs on the ordinary people. For example, the main government has granted privileges to mothers of second, third, fourth, and subsequent children to register for purchasing a car without even having a certificate, at factory price and out of turn.
This action has two destructive consequences. Firstly, the government is using the caliph’s pocket to pay for it, as only 15% of the shares of automakers are directly owned by the government. A significant portion of these companies’ shares belong to real and small shareholders in the stock market. In fact, the main government is paying for the cost of population rejuvenation from the shareholders’ pockets, which is a form of hidden tax.
On the other hand, this policy has created price tensions in the market. Consumers have been forced to purchase domestic products at much higher prices. Both automakers, who were seeking to compensate for their losses, and major market players, who are mostly connected to the government and have access to privileged information, have increased prices by creating a wave of news in the market.
However, the issue of unregulated vehicle sales is not the only manifestation of hidden taxes resulting from population growth. The allocation of land to insure the undocumented newborns born after the year 2021, as well as the provision of loans and banking facilities to these families without proper accounting, are also examples of hidden taxes that people bear due to the government’s policy of promoting population growth. In fact, the government uses people’s money to implement an ideological law in line with the demands of the Supreme Leader of the Islamic Republic. However, the ordinary people of the country bear the costs of this government propaganda maneuver.
Tax on savings
The interest rate in Iran is currently around -35% to -40%, meaning that if someone deposits their cash in a bank at the beginning of the year, they will lose about 35% to 40% of the value of their money by the end of the year. This is because the gap between the inflation rate and the deposit interest rate in Iran, as mentioned before, is negative.
By doing so, the government not only withdraws liquidity from the markets, but it can also partially compensate for the banks’ imbalances by taking advantage of negative interest rates. Additionally, it has recently been revealed that legal accounts for savings must also pay direct taxes, which is quite unique in the world. In fact, the government not only profits from price fluctuations resulting from intensified inflation, but it also takes advantage of the inefficiency of financial markets to preserve the value of people’s assets in banks and compensate for its own imbalances.
How the main hidden taxes affect people – Part 1
Iranian Instagram influencers and celebrities required to pay income tax
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