Title: Iran Implements Targeted Subsidy Reform with New Electronic Benefit Cards
In a significant move to refine its social safety net, the Iranian government is rolling out a new system of electronic benefit cards, shifting from universal cash subsidies to a more targeted approach aimed at supporting low-income families.
A Legal Mandate for Fiscal Reform
This policy is a key part of the government’s implementation of the legal mandates outlined in the national budget for the current Iranian year. The primary objective is the better management of state financial resources and alleviating the pressure of universal cash subsidies on the national treasury. A central pillar of this reform has been the phased removal of subsidies from the top three income deciles.
Phasing Out Subsidies for the Affluent
Government reports confirm that, as of the end of the Iranian month of Shahrivar, subsidies for approximately 6.6 million individuals identified as belonging to higher-income brackets have been discontinued. This strategic reallocation is designed to free up resources for a more equitable distribution among the nation’s most vulnerable citizens.
Electronic Cards: A New Mechanism for Support
The saved funds are now being channeled into a new electronic benefit card system. This non-cash payment method has already been activated for low and middle-income deciles, providing specific monthly credit amounts to facilitate households’ access to essential goods. This initiative is intended to directly strengthen the purchasing power of qualified families for basic commodities while optimizing government expenditure.
Streamlining Implementation for Greater Efficacy
While the policy’s goals are clear—to reduce fiscal pressure and bolster support for those in need—its execution involves complex logistical coordination. The involvement of multiple bodies, including the Subsidy Targeting Organization, the Ministry of Cooperatives, Labour, and Social Welfare, and the Planning and Budget Organization, necessitates precise collaboration to ensure efficient service delivery to eligible households.
Towards a More Equitable System
The transition from blanket subsidies to a targeted electronic system represents a substantial step in Iran’s ongoing economic adjustments. By focusing state support on those who need it most, the policy aims to create positive social and economic impacts. The continued refinement of this system, including the development of comprehensive databases for accurate beneficiary identification, is crucial for the full realization of its intended benefits.
Key Figures at a Glance:
- Monthly Subsidy Allocation: 36 Trillion Tomans
- Subsidies Discontinued (as of Shahrivar): 6.6 million people
- New Support Mechanism: Electronic benefit card credit
- Focus of Implementation: Enhancing coordination and data management
