Rewritten Title:
Breaking: 7 Million Tomans Cash Subsidy Rolled Out – What’s Next for Iran’s Welfare Reform?
Cash Subsidy Expansion Sparks Debate on Economic Priorities
In a recent statement, Mohammad Reza Bahonar, a member of Iran’s Expediency Discernment Council, outlined a bold economic proposal: allocating one-third of a $200 billion budget as direct cash subsidies to citizens. Under this plan, each Iranian could receive an annual sum of $1,000—translating to roughly 7 million tomans per month for a family of five, assuming exchange rate adjustments.
However, Bahonar cautioned that such measures would require parallel economic reforms, including potential price liberalization on essential goods like fuel.
Government Unveils New Welfare System for Targeted Support
Ahmad Meydari, Iran’s Minister of Cooperatives, Labor, and Social Welfare, announced a major overhaul of the country’s welfare framework following a Tuesday meeting with the Parliamentary Budget and Planning Commission. The new system aims to streamline cash subsidies by reallocating resources from higher-income households to low-income families, in line with the 2025 budget law.
Key Reforms Include:
- Phasing out subsidies for top 30% earners, affecting over 20 million citizens.
- Redirecting 5 trillion tomans monthly toward food vouchers and livelihood support for vulnerable groups.
- Launching a grievance mechanism for households contesting subsidy cuts.
Meydari emphasized that the reforms prioritize precision and fairness, leveraging updated income data to ensure aid reaches those most in need.
Strengthening Support for Low-Income Families
The government has already taken steps to bolster welfare programs, distributing food vouchers in three phases under a directive from the Supreme Leader and the heads of branches of government. These measures align with Iran’s broader strategy of targeted economic relief amid fiscal constraints.
Meydari also addressed challenges in tax policy, noting that VAT exemptions on essentials like dairy products limit revenue for welfare programs. As a result, reallocating subsidies from wealthier households remains the primary funding source for these initiatives.
Looking Ahead
The rollout of the 7-million-toman subsidy marks a pivotal moment in Iran’s welfare reforms—balancing immediate relief with long-term economic stability. As the new system takes effect, all eyes are on its impact on inflation, public satisfaction, and equitable growth.
Stay tuned for further updates on Iran’s evolving social welfare policies.
