Page 29 - IRANRptAug20

which ended in mid-March this year.
Years of lax regulation and corrupt financial practices have made tax collection and accounting a hugely problematic task in Iran. State organisations, paramilitary organisations and privatised companies are often the most significant offenders when it comes to the non-payment of due tax.
6.1.2​Budget dynamics - funding, privatisation
Iran to issue sukuk worth up to $217mn to fund oil and natural gas projects
Iran aims to privatise 600 companies in current Persian year
Iran is planning to issue sukuk securities worth up to $217mn to fund oil and natural gas projects, the country’s official energy news portal SHANA reported on May 2.
Vice President Eshaq Jahangiri reportedly signed off on the decision to ahead with the issuance, authorised under the annual state budget. It will permit the oil, energy and industry ministries to issue sukuk—Islamic sharia-compliant bonds—with a value of up to Iranian rial (IRR) 35 trillion ($217mn at the free market exchange rate).
Foreign investors, including France’s Total, have withdrawn from Iran’s oil and gas industry since the US reimposed heavy sanctions on the Islamic Republic in May 2018. Under those sanctions, the US initially issued waivers that allowed designated countries to import Iranian crude oil without fear of penalties being pursued by Washington, but in May 2019 it switched to a policy of attempting to drive all oil exports from Iran off world markets. There have since been widely varying reports on how successful Iran has been at exporting oil through grey market channels.
The head of the Iranian Privatisation Organisation (IPO) has announced that some 600 companies are to be fully or partially sold to private buyers in the 2019/2020 Persian calendar year (started March 21), IBENA reported on April 28.
The Rouhani administration is under growing pressure to allow more assets on to the market at a faster rate so that capital can move from the roiled currency markets and back into the local economy. With the Iranian rial (IRR) severely weakened by the US sanctions assault on Iran’s economy and Washington to launch its attempt at fully shutting down Iran’s oil exports on May 2, the government is under heightened pressure to increase efforts to deliver liquidity.
IPO director Mir Ali Ashraf Abdollah Pouri-Hosseini said that of the current block of companies to go up for sale, all the shares would be available to buyers except for 20% in each case, except where otherwise stated. However, it will be an uphill struggle to sell majority stakes in so many businesses, with Pouri-Hosseini noting that across six months of the previous calendar year, only 55 companies were privatised.
“If we can privatise double or triple this amount, still there would be many companies for sale,” he added.
29​ IRAN Country Report August 2020 www.intellinews.com