Mohammad Jafar Ghaempanah, the Executive Vice President, elaborated on the government's economic outlook for reforming the subsidy system in a press conference and pointed to the positive effects of these reforms on the country's economy. He emphasized the heavy costs of hidden energy subsidies, stating: "If we adjust the prices of gas, electricity, gasoline, and diesel based on the rates of our cheapest neighbor, significant changes will occur in the country's economy."
Possibility of 720 trillion tomans in revenue
Ghaempanah further stated that by calculating the price of gasoline at around 80 tomans (based on regional averages), the government could generate revenue of about 720 trillion tomans annually. If this revenue is realized, it could serve as a basis for providing subsidies to citizens.
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The Executive Vice President added: "Calculations show that with the realization of this 720 trillion tomans revenue, the government can pay about 7 million tomans monthly to each Iranian, which would reach 28 million tomans per month for a family of four." This type of resource redistribution could have widespread impacts on the living standards of households.
Reduction of ancillary costs and fuel smuggling
Ghaempanah also referred to the inefficiencies of the current system and the related ancillary costs, stating: "Currently, we incur heavy costs for administrative structures, meter reading, and following up on legal cases related to fuel smuggling. By implementing this plan, in addition to eliminating these excess costs, the issue of fuel smuggling will also be fundamentally resolved; as it will no longer be economically viable for smugglers."
These statements reflect the government's determination to transform the subsidy system and reduce economic problems caused by fuel smuggling and its ancillary costs. Ghaempanah emphasized the government's goal of establishing social justice, adding: "With this model, everything moves towards international rates; from worker and employee wages to fuel prices."
Given these proposed changes, it seems that the government is striving to create better conditions for establishing social justice and equitable access to national resources through the reform of the subsidy system.
