Targeted subsidies law (full text)
 
 
Article 1-Government is required to correct energy carriers price by observing this law
 
    A-Domestic price of gasoline,gas oil,fuel oil,kerosene and LPG and other oil
                derivatives,considering carriers quality and including following costs
                (transportation,distribution,tax and legal complications), shouldn't be less
                than 90% FOB in Persian gulf.         
       Note-Price of crude oil and gas condensate, for sale to domestic refineries,is
                determined 95% FOB in Persian gulf. And purchase price of products
                is determind proportional to the price.         
 B-Average domestic selling price of natural gas to be determined in such a way that after deducting transport, tax and duties costs, will be the same deal at least 75% average price of export natural gas, gradually until the
     end of the fifth programm of economic, social and cultural development for Islamic Republic of Iran. 
       Note-To encourage investment,the price of industrial,refining and petrochemical units,is determined maximum 65% of the export basket price in the origin of Persian Gulf(no transfer fee) per cubic meter, for at least   ten years after adoption of this law. 
          C-Average domestic selling price of electricity,to be determined in such a way that will be the equivalent cost, gradually until the end of the fifth five year program of economic, social and cultural development for Islamic Republic of Iran. 
      Note-Electricity cost be calculated considering total costs of energy conversion, transmission and distribution and fuel costs with at least 38% of the nation's power plant efficiency by standards compliance; and be added to the nation's power plant efficiency at least 1% every year, so that   to reach 45% efficiency in five years since this legislation and also transmission and distribution losses be reduced to 14% until the end of the fifth five year programm of economic, social and cultural development for Islamic Republic of Iran. Government is required ranking provides electricity producers about  Efficiency and do the same thing about distributors about losses rate,by  forming working group composed of governmental and nongovernmental experts,and adopt appropriate hortative and supportive policies.
 Note1-Regarding prices of electricity and natural gas, government is authorized to impose preferred prices,considering geographic areas and consumption type,amount &time Water,electricity and gas companies are obliged-if there is a possibility of increasing-to increase the number of meters only by obtaining meter and it's installing cost(in cases where several family or customers exploit one tributary; and if there is no possibility of increasing, the companies increase customers as number as operationals.                    
Note2-Prices of energy carriers for after the base year, is determined according to currency price intended for annual budget.  
Note3-Base prices in this legislation, be determined so that income be obtained100,000,000,000,000 Rials minimum amount and 200,000,000,000,000 Rials  maximum amount for one year.
 
Article2-Government is authorized-for managing fluctuation effects of energy carriers' prices on national economy-to supply this carriers the consumer unchanged, through obtaining the difference or paying subsidies.(if the  price does fluctuate up to 25% FOB in Persian Gulf) and to order the amounts to the account of set market for energy carriers in the annual budget. Prices will be revised if it will fluctuate more than25% .
 
Article3-government is authorized to determine water price and sewage collection & excretion wage, compliance with the law.
 A-Average price of water for different purposes according to it's quality and extraction mode within the country, be determined in such a way  that will be equivalent to the cost,gradually until the end of the fifth five year program of economic,social and cultural development for Islamic Republic of Iran.                    
   Note1- Government is required to determine the water cost with regard to costs of supply,transmission.and distribution,observing efficiency.
     Note 2-Preferential and stair prices determination for different uses of water, will be allowed,considering geographic areas and consumption type&amount.
  B-The wage of sewage collection & excretion services is determined based on the total cost of network maintenance&operation after deducting the intrinsic value of waste delivered and government assistance in the annual budget(related incentive policies).
 
 
Article 4- Government is obliged to act towards subsidies of weat , rice ,oil, milk,suger,postal services,aviation services and rail services(passenger),gradually until the end of Fifth Five-year Economic,Social and Cultural Islamic Republic of Iran.
 Note – Subsidies payment to agriculture section producers,shouldn't be less than it's
            Previous year.
 
 
Article 5-Government is obliged to provide applicant consumers,flour and bread
                subsidies-regarding appropriate methods-to the extent that will be
                determined in the annual budget bill.
 Note-Per capita bread subsidies for villagers,cities below twenty thousand
              Population and vulnerable groups in other cities-as government recognize-,
              Would be at least 50% more than the average subsidies per capita.
 
 
Article 6-Government is obliged to adopt the needful incentive and supportive Policies for create and expand industrial bread production units an Also help about redressing flour and bread production units which
               Would be difficult to continue their activities,because of this legislation. Executive regulations of this article will be prepared by ministry of Commerce,in cooperation with relevant devices,and it will be enacted by
                 Council of ministers,maximum within three months after the passage of this law.
 
 
 Article 7-Government is allowed spending maximum 50% of net proceeds resulting
                from implementation of this law, clauses in the form below:
            
             A-Subsidies paid to households in the form of cash and non-cash payments,considering family income towards all families in the country.
    B-Running a comprehensive social security system for targeted population such as:
                -Develop and providing social insurance,health care,provide and promote
                 public health and drug&medical coverage for specific&refractory patients.
                -To help providing housing costs,housing retrofitting and occupation.
                -Empowerment and running social protection programs. 
    Note1-Executive regulations of this article,including modality of recognition
               targeted community and update needed information bases,modality of
               payment to targeted community and payments-listed in this article-will be approved by council of ministers (considering by minister of economic and
                finance affairs,minister of social welfare,and head of management and
                planning organization),maximum three months after approving this law. 
    Note2-government may open account about targeted subsidies,under the name of
               head of inclusive households or another qualified person,who is determined
               by the government.
               To apply government management about modality of spending payments-
                listed in this article-including time allowed,type of harvesting costs and
                payback(in cases which is settled by mistake),is allowed.
 
 
 
 
 Article8-Government is required to cost 30% of net proceeds resulting from
                Implementation of the law,to pay gratuitous aids,or subsidies for facilities
                profit,and also it may cost for administered funds for the following:
 
            A-Optimize energy consumption per unit of manufacturing,service and
                 Residential,and also to encourage saving and observing consumption
                 patterns(determined by relevant administration).
 
             B-Reform about production unit's technology in order to increase energy and water efficiency,and to develop producing power from renewable sources.
 
             C-Remedy some part of the losses-resulting from implementation of the law-
                 Incurred to the companies provider services about water&waste water,power,natural gas and oil products,also municipal and charge of villages.
 
              D-To expand and improve public transport(in the context of developing  public transport law and fuel-consumption management), and payment maximum up to credits about article 9 of the law.
 
              E-Supporting manufacturers active in agriculture and industrial sections.
 
              F-Supporting industrial production about bread.
 
              G-Supporting non-oil exports development.
 
              H-Developing interactive electronic services aimed at eliminating or reducing unnecessary travels.
 
 
        Note-Executive regulations of this article-contains modality of protection industries,agriculture,and services,and also modality of payments listed in this article-,is approved by council of ministers(considering by ministers of  Economic and Finance affairs,Industries and Mines,Agriculture,Commercial,Oil,Power,Territory,Chamber of Commerce,Industries  and Mines,Chamber of Cooperation,and Head of Management and            
                  Planning Organization),maximum three months after approving this law.
 
 
 
 
                     
Article 9-Sources listed in articles 7&8 of this law(including grants,facilities and funds managed by banks and-governmental and nongovernmental-credit  institutions)will be provided to these individuals.
 
 
 
Article10-Receiving aids and subsidies listed in articles 7&8 of this law depends on providing correct information. If provided information won't be correct,government is required(while stopping payment)to perform necessary legal  action about refunding payments.  If individuals think deserve receiving aids and subsidies listed in articles 7&8 of this law,may present their protest to a commission-predicted in  executive regulations of this article Executive regulations of this article is approved by Council of Ministers (suggesting by Ministers of Justice,Economic and Finance affairs,Social Welfare,and Head of Management and Planning organization),maximum  three months after notification this law.
 
 
 
 Article11-Government is allowed spending maximum 20% of net proceeds resulting  from implementation of this law,in order to compensate for it's effects on cost credits and acquisition of capital assets.
 
 
 
 
 Article12-Government is required to deposit all resources resulting from  implementation of this law,to a special account,called targetted subsidies. 100% of deposited funds will be designated for cases predicted in article7, 8 and 11 mentioned in this law.
 
        Note1-Government is required to insert credits about resources and expenditures- listed in mentioned articles-,in four separated rows,in the annual budget bill.
 
         Note2-Cash and non-cash assistance-resulting from implementation of this law- to individuals and legal personalities,shall be free of paying income tax (the subject of direct tax law,approved march 1988,and it's subsequent  amendments.)
                           Assistance to the persons mentioned above,won't be covered by this note,if it is in order to offset all or part of the price of goods or services supplied by them.
 
         Note3-Government is required to provide detailed report of this article to Supreme Audit Court and parliament,every six months.
 
 
 
 
 
 Article13-Funds needed for implementation of this law,will be considered in fund in the annual budget,and depreciates during the year,of resources resulting  from implementation of this law.
 
 
 
Article 14-Transfering credits listed in articles 7,8 and 11 of this law,is allowed maximum 10 units in 100,in annual budget,so that the total funds be used  in cases anticipated in this law.
 
 
 
 
 Article 15-Government is allowed to create an organization in the nature of public companies,using available resources(facilities,manpower and funds)for implementation this law in terms of the law,called "targeted subsidies organization",within a month after binding this law.Mentioned organization also may be established by reform and integration the existing companies.  Government is authorized to withdraw continually,proceeds from the implementation of this law,deposited to treasury(exactly after receiving and deducting government's share-mentioned in article 11-);and also is allowed providing mentioned proceeds to the organization to put,as an help(just for performance objectives and assignments,listed in articles 7 and 8 of this law)to cost the same amount. The organization is managed centralized and is just allowed to have staff,planning and monitoring units in central office.Ministers of Social Welfare,Economic Affairs and Financ,Commerce,Transportation,Agriculture,Industries and Mines,Oil,Energy and Head of Management and Planning Organization,are General Assembly members.Company statute,including organs,functions and powers,is being produced by ministry of Economic Affairs & Finance and Management & planning Organization.Then it will be approved by Council of Ministers.Funds and credits listed in this law,including articles 12 and 15,are  reflected in the budget(as it is about the other public companies). Changes in the credit ceiling during the year,(except powers and permissions listed in this law,including articles 2 and 14),is permitted,if  the government propose and parliament approves.  Remaining funds at the end of the year,is usable in the next year, and the organization may create commitment each year for later years, in the context of this law.Credits listed in this law,is inclusive to the law about how  spending the credits(which are excluded observing public audit act and other general government regulations-approved in 26.1.86.Organization is required to provide performance reports about receipt and payment about resources resulting from making subsidies targeted-separation articles 7 and 8-for Planning and Budget Commission,Audit Commission and other related commissions-formed  in the parliament-,at the end of every six months.  Supreme Audit Court is required to provide reports the operations based on the predicted goals in this law,and conducted by organization,for parliament awareness,every six months.
 
 
 
 
     Article 16-Government is authorized to increase tax exemption listed in article 84 of "Direct Tax Law",(beside the annual increasing about tax exemption,  proportional change and correct prices-listed in this law-,and proposed  by the Ministry of Economic Affairs and Finance),maximum twice,since  the april of 2010,over five years.
 
                     
                      The above law-including sixteen articles and sixteen notes-was  approved in an open session of parliament formed on Tuesday 5th of   January 2010 and was confirmed by SHORAYE NEGAHBAN on 13th of     January the same year.

 

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