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Kayhan: 'What happened? Nothing!'

20 Jul 2010 23:1714 Comments
Shariatmadari.jpgKayhan | On July 18, Kayhan carried the following editorial by Hossein Shariatmadari:

It was after the Tehran Friday prayer. I was hurrying to the newspaper when a youth put a hand on my shoulder. He had a luminous face, like all the people at the Friday prayers service. He greeted me and shook hands as always but would not say goodbye. He asked, is it true the Tehran bazaaris have closed down in protest against taxes? I said not all of them, but the report is correct. He said I read somewhere that the total taxes collected from the guilds and bazaaris is only five percent of all the taxes the government collects. I replied in the affirmative. He asked: How much is the tax share of you and I and other staff and laborers that is deducted from our salaries on the first of each month? I said as far as I know between eight and nine percent of the entire nation's tax collections. He asked, is that just? Which one? I asked. The taxes taken from us wage earners or the taxes the guilds and the bazaaris pay?

He said we have no complaints. I am talking about the guilds and the bazaaris, with that enormous wealth and the huge incomes many of them have. I said no, it is not just. Their share is much more than what they pay. He asked, meaning they take taxes from us laborers, staff and oppressed low-income classes to spend on the welfare and security of bazaaris and provide services to the wealthy? I am not happy about this. I said all bazaaris are not like this. Most of them are believers and religious people who know the difference between the permitted and the forbidden and they know the rights of the people. He asked then why do they sit silently in the face of the bullying of a minority? I said they have not been silent. Many of them are seeking a just solution and of course more is expected of them. He indicated the street we were standing by and said these streets were built with our money, but the rich people who do not pay taxes travel on it with their expensive high-model vehicles. Our homes do not need police surveillance. What naive thief is wasting his time stealing from our homes? They are spending money out of our pockets to provide financial and life security for wealthy people who avoid taxes, skyscrapers, luxury and nobility homes, ultra modern villas in the areas of the nation with the best climate and ... [as published]

He took a fresh breath and said I know you are in a hurry, but just one more question. In your view, if the bazaaris closed their shops forever, what bitter and undesirable thing would happen? I said do not judge all of them this way. He said the question pertains to the ones who close their shops and make a commotion every time the issue of taxes arises. It was a difficult question and perhaps for this reason I had never thought about it. The enthusiastic youth came to my aid and said most of the bazaaris are just retailers. They do not produce. The government could establish sales centers in various parts of the city, in other words the same thing it does during the New Year holidays. With this measure, in addition to the creation of employment for many unemployed youth, prices would be controlled, taxes could be precisely calculated and with the use of the barcode system they could be easily calculated with complete justice.

I hesitated a little. It was not difficult to answer his question, If the bazaaris closed their shops forever what bitter and undesirable thing would happen? I answered confidently: "Nothing!!" The tax percentage on GDP in the advanced and developed nations is more than 45 percent. In the developing nations this percentage is 15 to 20 percent, while in Iran it is between 7 and 8 percent. In other words, in Islamic Iran the lowest taxes are collected and for this reason our nation is famous in the world as a "tax haven."

Tax evasion in the Islamic Republic of Iran is 50 to 60 percent. Laborer and salaried workers pay their taxes as deductions whether they like it or not before receiving their monthly pay. Although in some cases industry owners and producers of goods create accounts to evade taxes, their taxes are calculated according to formula and procedure and they pay in accordance with the law. Therefore the question is who evades the payment of taxes and creates the 50 to 60 percent tax-evasion figure? The Ministry of Economic and Financial Affairs has divided the guilds into groups A, B, and J. Group A includes the guilds that have enormous financial circulation and are mostly importers and exporters. This group has been required to maintain daily and general accounts and make them available to tax agents.

Although Group B has huge and significant financial circulation, they are at a lower level than Group A. This group is obligated to keep books on income and expenses. Group J includes retailers and ordinary shopkeepers. This group, which includes almost all bazaaris, must provide the Tax Affairs Organization with a summary of income and expenses on a standard form; they must register it and record it and give it to tax officials. Most tax evasion is done by the people in Groups A and B. The people in these two groups -- not all of them -- despite their astronomical and enormous incomes are not only unwilling to pay taxes, meaning the right of the people, but whenever the question of their tax accounts is raised they resort to blackmail, lying, spreading rumors and even threatening the bazaaris, and through mercenaries they do things like closing shops while trying to make a political event of their tax evasion! At the same time using foreign media they try to attribute to all believing and committed bazaaris ugly and impure measures like this for which the most appropriate term is "devouring the assets of the people!"

A reliable report indicates that a small number of merchants and big gold and jewelery bazaar sellers are responsible for most of the destructive activities in instances such as this. With calculations and studies the government has come to the conclusion that the revenues of the guilds have increased significantly since the year 1387 [two years ago] and finally in talks and consultations with union and guild officials they have settled on a 15 percent revenue increase and they are making tax demands in this same amount. The guilds in Group J, meaning almost all bazaaris, are in agreement with this figure but the people in Group A and people in Group B are claiming that the market has been stagnant in the last two years and this amount of tax goes beyond the true figure. This claim is being made at a time when in the last two years the inflation rate has been fixed at 15 to 17 percent and at the same time the guilds and bazaaris, in accordance with their own tradition, have added 15 to 20 per cent each year to their prices. Therefore the government's tax demands are not only just but lower than the true level and the people who are refusing to pay taxes do not have the slightest excuse for doing so.

Here it must be said that the government can and according to the law has the right to ask the principal agents of this unacceptable activity whom we know have legendary wealth "where did you get it?" It has the right to complain to religious and believing bazaaris and ask them why they did not do anything against the plots of this small group of people. The greatest hope of the bazaaris is to establish religious councils, to visit holy shrines, to help the needy and to do this type of God-pleasing activity. What do they have to do with a handful of people who devour the assets of the people, have accumulated legendary fortunes out of the pockets of this oppressed nation and spend the summers lounging at the Hawaiian Islands and the winters on the Alpine slopes?

Taxes are the right of the people and the government does not have the right to be remiss taking action against people who threaten to close the bazaar through a handful of hired mercenaries and who blackmail and spread ambiguities. In the last few days the telephones at Kayhan have not stopped ringing and many religious and committed bazaaris, meaning almost all of them, have been complaining about the failure of officials to take action against the plot of a handful of prosperous capitalists who feel no pain, and especially in the present sensitive circumstances. Just consider the content of a few messages from the mass of messages that have been sent to the newspaper: "We, the youth of this land, are the children of 9 Dey and 22 Bahman. If the officials in charge have considerations for taking action against the plotters who have also been identified, they should inform us and the mass of believing and committed bazaaris. We, the committed and believing bazaaris, are together in all the ups and downs and we still adhere to this sacred tie for confronting the agents of the plot."

As translated by Mideastwire.com.

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Good to see one example of the massive propaganda that IRI uses to keep Iranians in the dark.

Bahman / July 21, 2010 3:59 AM

Pirouz and the rest of the IRI propaganda crew,

You got some garbage journalism published on TB - happy?

Agha Irani / July 21, 2010 7:29 AM

If taxes on merchants supply 5% of government revenue, and income taxes supply 9%. Where does the other 86% come from?

muhammad billy bob / July 21, 2010 7:52 AM

"He had a luminous face, like all the people at the Friday prayers service."

Actually, I have a superluminous face, but have never prayed or attended a religious service in my life.

What's wrong with me?

Ali from Tehran / July 21, 2010 7:44 PM

Billy Bob,

Some 80% of Iran's export is nothing but oil. Additionally, Iran sits on top of the second biggest gas reserves in the world, but Iran imports almost twice as much gas than it exports.
They are in deep trouble with their dwindling oil exports/revenues due to sanctions. The bazaar serves as a good example of future events to follow. This is more than just taxes. This is the outcome of a system that is consumed by the mullahs and the Guards and is leading their initial backers namely the bazaaris into certain bankruptcy. This system is consuming its own. The Barbaric Republic is on life support system and brain dead.

Niloofar / July 21, 2010 7:58 PM


It must be the Royal in you comrade.

Niloofar / July 21, 2010 8:13 PM

And what percentage do the mullah's (and all their various organizations) pay?

sickofit / July 21, 2010 9:02 PM

I would imagine that the remaining 86% of government revenue is collected from the sale of oil, which is under government control in Iran. And since the government is siphoning off this money, it is safe to assume they can not pay the oil workers that much more.....A de facto income tax on oil workers.

muhammad billy bob / July 21, 2010 9:52 PM

Once more, Shariatmadary created a op-ed using his dreams. Really, i bet ya,in reality none of that alleged conversation has ever happened .
He just wanted to com up with a punch line and thought with himself " What a revolutionary idea" to make something up. After all he is a pro on this subject. Examples are abundant, take a look at the past election results and Kayhan reports before and after.

good luck everybody

PersianTraveler / July 21, 2010 11:00 PM

Yes, I noticed some kind of attempt has been made. But it's intent is insincere, judging by the title. And this particular selection has been chosen merely as a means of discredit.

Perhaps next time we can get perspectives and analyses offered by more objective political scientists from the U of T, the likes of which Kaveh Afrasiabi used to resource, before his recent incident appears to have sidetracked him.

There are talented contacts in Tehran that have proven reliable in their perspectives, to analysts such as the Afraisabi, the Leveretts and even Majd.

Merely translating a selection from Kayhan is a very lazy approach, at best. At its worst, it's insincere.

Please put forward a genuine effort next time.

Pirouz / July 21, 2010 11:31 PM

This article wasn't published to appease anyone. The title used, "What happened? Nothing!", is a translation of the Kayhan headline.

Moderator / July 21, 2010 11:40 PM


The Leveretts, et al already have a major forum: the opinion pages of The Gray Lady [The New York Times]!

Sohrab Ahmari / July 22, 2010 5:47 PM


It's probably a little difficult to get an objective analysis from Tehran these days. Such things are likely to get one either killed, thrown in jail, or at the very least fired.........any volunteers?

muhammad billy bob / July 24, 2010 9:46 PM

All other innuendos in the translated article aside; when presenting such a topic if at all about taxes, one must include the process of taxation, and how it all flows down hill into the pocket of the consumers who ultimately pay all of the taxes. Bazaar (the Mal, or Market) will pass all its expenses onto its customers, as it must make a living, and make a net profit, in fact the higher the taxes the better as they can pass the high prices to taxation and not their profit margins. There are several taxation, one of business tax, two of incomd tax, and three of sales tax (or hidden under VAT). The new value added taxes (VAT) is also nothing but a sales tax hidden through the process of marking an item from production (better said importation in Iran case) which again raises the final consumer’s purchase prices. Therefore the Bazaaries or the wealthy, and whomever, once a consumer end up paying the entire taxation, and as the common people are more numerous than the reach, and market owners therefore the burden is on their back. The business side will even pass its income tax onto the consumer as it holds the merchandise therefore all its cost and expenses must be recovered by its sales just like all other countries in the world. Therefore, when taxing the business, in reality the consumers are being taxed, and when increasing income tax all must pay but again the business will pass its costs to its sales and down to the consumer. And the VAT is all for the consumer.
On the event itself it is not clear as for the real reason however, the years tax percentage had not been set for the Bazaar to pass it on to the consumers, thus to keep the inflation down, but to increase the tax income at the end of tax year a high percentage was floated to take the amount from business pocket which backfired and because it was floated and not officially set, quickly a new settlement was reached to quite the issue. All the tax increase of last tax year will show itself in the next year’s prices to make for the business loss of last.
On the matter of closing ones store it is an owner’s right to do so especially when it is none essential goods and there are no laws against that, therefore it was for no one to do anything about it be it the government or be it the other markets in the Bazaar as the article dictates. The Bazaar can be closed and stores dispersed throughout the city but it would change nothing, a business must make profit and if it does not then it will close and invest on other things or take its money out of the country to save it.
Such article is to influence commoner without giving a documentary on how the taxation works, and how it is passed down to the consumers, thus to raise their emotions against the business for this go around, and similarly against others on the next go around for other matters the same half story will be used.
To fight such half truths it would help if along with printing such articles the other half of the story would be presented to the reader as well.

Bruce / July 30, 2010 1:09 PM