Speaking Sunday in an open session of Parliament during deliberations on the general outline of the fiscal 1405 budget bill, Pezeshkian said institutionalizing energy conservation and making resource distribution more equitable would also prevent continued inequality in access to energy subsidies.

According to the presidential website, Pezeshkian said the total fiscal 1405 budget, in terms of revenues and expenditures, amounts to about 14,441 trillion rials. The general government budget, including revenues and the sale of capital and financial assets, as well as expenditures and capital acquisitions, totals about 5,950 trillion rials. This includes 5,220 trillion rials in general revenues and 734 trillion rials in earmarked revenues for ministries and state institutions.

He said the combined budgets of state-owned companies, banks and government-affiliated for-profit institutions are projected at about 8,896 trillion rials on both the revenue and expenditure sides. He added that after deducting duplicated entries, the net total budget stands at about 12,543 trillion rials.

Commitment to Justice in a Difficult Year

Pezeshkian described the preparation of the fiscal 1405 budget as taking place under exceptional conditions, citing the country’s worst drought in half a century, a sharp decline in global oil prices, reduced oil export revenues, intensified sanctions and a major war imposed on the country.

He said the new budget differs significantly from previous years, noting changes to Parliament’s internal regulations, the shift to a single-stage budget process, new legal requirements, the removal of notes and provisions from the bill, changes in submission timing, and the redenomination of the national currency with the removal of four zeros.

“I consider myself committed to moving along the path of justice,” Pezeshkian said. Despite only a 2% increase in the overall budget, government employees’ salaries will rise by 20%, he said. While acknowledging that the increase does not fully match inflation, he said the government has sought to narrow the gap through higher tax exemptions.

Under the plan, salaries up to 40 million rials will be fully exempt from income tax, while those earning between 40 million and 93 million rials will pay a 10% tax, a measure he said would offset part of the inflationary pressure.

Oil Revenues for Transport Infrastructure

Addressing subsidies and energy consumption, Pezeshkian said about $6 billion was spent this year on gasoline imports, questioning why such a large amount of foreign currency should be used when consumption could be managed and savings paid directly to the public.

He said the government plans to allocate part of oil export revenues to completing rail projects and transport corridors, accelerating the completion of road, rail and urban transport infrastructure.

A significant share of government efforts is also focused on upstream oil and gas projects, including collecting associated gas flaring and increasing production, he said, with the goal of preventing gas shortages in winter and power outages in summer.

 Funding Energy Development and Renewables

Pezeshkian said the budget — including allocations for oil and gas companies — addresses support for the sector and the provision of foreign currency needed to develop oil and gas fields and collect flare gas. He added that the government will accelerate the development of solar energy next year to fundamentally address energy concerns for households and industries.

He described the establishment of a vice presidency and a national energy efficiency organization as an important step toward reducing fuel consumption, saying resources saved through efficiency could be redirected to production.

Emphasizing fiscal discipline, Pezeshkian said transparency in government revenues is a key feature of the 1405 budget bill. He said the government has avoided including unrealistic revenues from oil exports, asset sales or privatization to prevent budget deficits.

Inequality in Energy Subsidies

Pezeshkian said the government has sought to present major subsidy items — including bread subsidies estimated at about 2,900 trillion rials, preferential exchange rates and gasoline imports — as consolidated budget lines so that, if approved by lawmakers, subsidies can be transferred directly to the public rather than intermediaries.

He criticized the current distribution of energy subsidies, saying a person with a single car effectively receives about 80 million rials a month in hidden subsidies from just one tank of gasoline, with the figure rising to 200, 300 or even 400 million rials with higher consumption. Similar imbalances exist for diesel, electricity, water and gas, he said, while many citizens face serious livelihood and health difficulties.

“It is unacceptable for a country with vast oil and gas resources to produce and consume millions of barrels of oil a day while some people go to bed hungry,” he said.

Call for Bold Energy Decisions

Pezeshkian said saving just 10% of resources, especially energy, could help resolve major problems, from paying salaries and supporting livelihoods to developing infrastructure and strengthening security. Aligning prices more closely with reality and reforming current practices are achievable management decisions, he said, warning that continuing the current path would only deepen problems.

He called for decisive action in the energy sector, stressing that the first step is institutionalizing conservation, followed by fairer distribution of resources currently benefiting a limited group. “These resources must be redistributed in a just manner,” he said.