- 10 October 2008
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- Events in Iran, Iranian American activism, Persian Gulf
Widespread strikes shut down stalls in the Tehran, Esfehan, Mashhad and Tabriz bazaars earlier this week in protest to the implementation of a 3% sales tax. The sales tax is an integral pillar of Ahmadinejad’s revision of Iran’s antiquated tax code and banking systems; hoping to cut government expenditure and lowering inflation.
Although the implemented 3% sales tax only applied to gold and jewellery shops in the bazaars, other shopkeepers closed down their stalls in solidarity. Bazaaris are worried that being forced to pass on the sales tax to consumers will hurt their businesses, in the context of a reported 29% inflation rate in September according to Iran’s Central Bank. Some retailers didn’t mind paying the sales tax, but worried that there would be an arbitrary implementation, ultimately benefiting only larger competitors with government connections. In the words of a carpet salesman quoted in a Washington Post article, “In Iran, if you have connections, you don’t have to pay any taxes…but we don’t have those connections. So we probably have to pay double.”