23rd April 2008
Administration of Value Added Tax in the Islamic Republic of Iran's Customs Administration (IRICA)
The customs administration of the Islamic Republic of Iran has no problem with administering VAT on imports and exports.
Yesterday, members of the group for coordination with customs administration on attended a meeting with the head of the I.R.I customs to discuss matters concerning administration of VAT to exports and imports. According to the public relations department of customs administration, Mr. Hashem Rahbari, head of the customs administration said that 3 world records in VAT implementation history are to be broken by Iran and referring to matters concerning administration of VAT to exportation and importation said: “I believe, low VAT rate, extensive exemptions provisioned in the in VAT Act and the short time schedule planned for VAT implementation, all of which a world records in itself, not only cause no problems for VAT implementation in Iran but also contribute to it in a way. He said that for implementing VAT there are two main points as concerns customs. Those two points are exportation and importation, of which the latter is easier to start with due to the limited number of taxpayers involved in it. He continued that two questions rise concerning VAT implementation in customs: First, importers do not usually declare true value of imported goods. For this customs has preventing mechanisms to identify under-declarations while auditing declarations at further stages, though much to our regret the process takes long.
He added: “It is important to know as to how the problem is cared for in VAT system and how the government’s claims concerning this are to be saved. The second question is if an importer imports something for personal consumption, how will it be treated under VAT?
He then criticized World Bank policies regarding implementation of VAT in customs and said that:” World Bank should invest on an advanced [customs] system and provide us with such systems whereas it only supports ASICUDA system, which is an outdated system, financially. He continued: “we have an electronic code by which we identify all natural and legal persons. Considering our capacities [I think] we will have no problem in administering VAT. He also said that to implement VAT correctly the tax administration should have online linkage to the customs administration information [concerning importation and exportation].
Source: Iran Newspaper