Chapter 10 – Economy, Currency, and Financial Oversight
Rationale of Article 93 – Natural Resources and National Heritage
Article 93 is established so that the foundational wealth of the country, as well as the historical heritage of Iran, are removed from the status of property subject to the disposal of the government of the day, officeholders, or rent seeking networks, and are expressly placed in the position of “belonging to the people of Iran”. This Article seeks to make clear that resources such as “major mines, oil, gas, public waters, forests, pastures, coasts, and other public wealth” are not the personal property of the government, dynasties, political officials, or military and security institutions, but are a national trust that must be administered only in the direction of the public interest.
The phrase “exploitation, transfer, extraction, or any contract relating to these resources shall take place only by law and with full transparency” is included in order to close the way to hidden rule, behind the scenes contracts, and the sale or transfer of national wealth on a patronage basis. In a country such as Iran, the principal danger is not only economic abuse. The greater danger is that the government or circles of power may turn natural resources into an instrument for consolidating political domination. By subjecting all such matters to law and full transparency, Article 93 seeks to remove these forms of wealth from the reach of personal will and secret decisions. The emphasis on “the public interest, future generations, and the protection of the environment” also exists so that the use of natural resources is not measured only by the logic of immediate revenue or short term profit. Article 93 accepts that natural resources must be used, but that such use must not lead to the destruction of the ecosystem, the plunder of national wealth, or the deprivation of future generations of the common assets of the nation. Thus, this Article is at once against corruption, against plunder, and against destructive development. The phrase “no authority or institution has the right to transfer these resources secretly, exclusively, or non competitively” is the anti authoritarian core of Article 93. For in practice, one of the most dangerous forms of concentration of power is that the government distributes national resources among those close to it and, through a rent based economy, purchases political loyalty. Article 93 is designed precisely to prevent this condition. The natural wealth of the country must not become the source of sustenance for a ruling class or a closed network of power. The part concerning “important contracts relating to natural resources”, which must be “public, auditable, and subject to the oversight of independent legal and financial authorities”, exists so that no major national contract may be concluded in darkness. This part of Article 93 has a direct connection with Article 97 and Article 98 in this same Chapter. National wealth remains protected from authoritarianism and corruption only when contracts are public and when independent auditing and oversight exist over them.
In the second part, Article 93, by referring to “historical and archaeological آثار, objects, and findings”, extends the scope of national heritage beyond natural resources and brings the historical identity of Iran itself within the protection of the Constitution. This part is highly important for a country such as Iran, because national identity does not rest only upon land and underground resources. A large part of the historical existence of Iran lies in its آثار, objects, and civilizational findings. Article 93 therefore seeks to protect both the material wealth of the country and its historical capital from plunder, smuggling, destruction, and hidden appropriation. The fact that the discovery of such items is regarded within the limits of the law, as permissible for all persons means that the Constitution does not seek to place discovery in the monopoly of the government or of a particular class. Yet at the same time, because such findings are considered “part of the national and historical heritage of the country”, the finder is not their absolute owner and has no right to conceal, smuggle, or destroy them. A measured balance is created here. On the one hand, discovery is permitted to all. On the other hand, the result of discovery belongs to the nation, and the government has the duty to “acquire it for a fair price, register it, and … preserve it”. This part protects both the rights of the finder and the national interest. The obligation of the government to acquire, register, and preserve such items for keeping in the National Museum or other competent public institutions also exists to prevent two dangers: first, the abandonment of historical heritage to the black market, and second, arbitrary confiscation without fair compensation. Article 93 does not say that the government may take whatever it wishes without payment. Rather, it says that the government must intervene at a fair price. This point is important, because Article 93, while national in outlook, is also against injustice.
Finally, the assignment of the “conditions, formalities, method of evaluation, and exceptional cases” to law is intended to ensure that the Constitution does not descend into executive details, while keeping the foundational principles firm. That is, Article 93 builds the pillars: ownership by the nation, transparency, prohibition of patronage based transfer, protection of future generations, protection of the environment, preservation of historical heritage, and fair compensation. The technical details are to be regulated later by ordinary law, but no legislator or government will any longer be able to circumvent these pillars.
In summary: Article 93 seeks to remove the natural and historical wealth of Iran from the reach of personal power, political patronage, hidden transfer, destruction, and plunder and to place it in the position of a national trust belonging to the people of Iran. By this Article, natural resources must serve the public interest, future generations, and the protection of the environment, and the historical heritage of the country must be preserved, registered, and protected from the black market and destruction. The anti authoritarian core of Article 93 is that the government may no longer treat national wealth and national heritage as its own property.
Rationale of Article 94 – Prohibition of Direct Economic Activity by the Government
Article 94 is established so that the government is transformed from a direct and dominant actor in the economy into an institution of regulation, oversight, and guardianship of fair competition and the public interest. Historical experience has shown that whenever the government itself becomes the owner, manager, dominant investor, and direct operator of enterprises and economic activities, the conditions are created for patronage, corruption, monopoly, inefficiency, and the subordination of the economy to political power. This Article is established to break precisely that dangerous link between governmental power and economic power, so that the economy, to the greatest extent possible, remains in the hands of the private sector and competitive mechanisms.
The emphasis that the government, except in exceptional cases expressly provided by law, has no right of ownership, administration, controlling investment, or direct commercial and economic operation, is intended to ensure that the government cannot, under the pretext of administering the country, itself become the largest business operator and the rival of the people. In an anti authoritarian system, the government must set the framework, implement the law, prevent monopoly, and safeguard consumer rights and the public interest, rather than becoming the principal actor in the market. By entrusting economic and commercial activity, in principle, to the private sector and to independent private cooperatives, Article 94 seeks to keep the economy free from the direct domination of political power. The provision that state enterprise activity is permitted only in wholly exceptional cases, by the enactment of a specific law, for a defined period, and upon proof of public necessity, exists so that the exception does not become the rule. In many countries, governments have entered the economy under the title of temporary intervention or public necessity, but that entry has turned into a permanent and bloated structure of state control. By restricting the scope, duration, and legal basis of such intervention, Article 94 seeks to ensure that the government enters the economy only in truly necessary conditions and, once the necessity has passed, withdraws from it. This Article also expressly provides that no governmental, military, security, or public institution, nor any entity affiliated with them, has the right to exclusive domination, special privilege, or noncompetitive presence in economic activities. The importance of this clause lies in the fact that the danger of state control and monopoly does not arise only from the government in the narrow sense of the term. Military, security, or public institutions that possess power and privilege may likewise become unaccountable economic empires. Article 94 closes the way to the privileged and discriminatory presence of such institutions precisely in order to prevent this dangerous concentration.
The emphasis that the transfer of public assets, privileges, and enterprises must be transparent, competitive, lawful, and subject to review, and that patronage based, hidden, or discriminatory transfer is void, exists so that the struggle against state economic control does not itself become an instrument of new corruption. Privatization, if carried out without competition, transparency, and oversight, turns from a state monopoly into a patronage monopoly dependent upon power. Article 94 seeks to ensure that the withdrawal of the government from the economy is accompanied by law, competition, and accountability, and not by the hidden transfer of privileges to those close to power. Article 94 also closes the path for governmental abuse of the position of regulation and licensing. For that reason, it expressly provides that the government cannot, in the name of regulation, oversight, licensing, or public support, create an economic privilege for itself or for affiliated institutions, nor restrict competitors in a discriminatory manner. This clause is important, because economic authoritarianism does not arise only through direct ownership. At times, without formally becoming an operator itself, the government diverts the market in its own favor or in favor of its affiliates by means of licenses, subsidies, exemptions, or prohibitions. This Article seeks to draw a clear line between legitimate regulation and discriminatory intervention. The acceptance that property ownership and investment by non citizen persons in Iran is permitted, within the limits of the law and with due regard to national security, public order, the interests of the country, and the prohibition of ownership in sensitive regions or sectors, is likewise intended to establish a balance between economic openness and the protection of national interests. The country must not, with a closed mentality, deprive itself of investment and economic activity. Yet at the same time, it must not leave open the path to harmful economic penetration, acquisition in sensitive areas, or disruption of national security and national interests. This clause seeks to make investment and ownership possible while maintaining respect for the law and the interests of the country.
In summary: Article 94 is intended to free the economy of the country from the direct domination of the government, the monopoly of institutions affiliated with power, and patronage and structural corruption, and to organize it on the basis of fair competition, transparency, lawfulness, and the activity of an independent private sector. The anti authoritarian function of this Article lies in the fact that it breaks the link between political power and economic domination, keeps the government in the position of regulator and overseer, and prevents the government or institutions affiliated with it from turning the economy into an instrument for consolidating their power.
Rationale of Article 95 – Monetary Policy Council and the Independence of the Central Bank
Article 95 is established to ensure that the Central Bank remains free from the domination of the government of the day, political parties, military and security institutions, and short term political expediencies. If the institution responsible for the preservation of the value of the currency, the control of inflation, financial stability, and the safeguarding of the integrity of the monetary and banking system becomes subject to the direct will of political power, the result will usually be chronic inflation, a decline in public confidence, economic instability, and the instrumental use of the national currency to conceal the fiscal errors of the government. Article 95 seeks to restrain this danger at its root and to make clear that the administration of the country’s currency must not become an instrument of day to day politics.
The emphasis of Article 95 that no political, executive, partisan, military, or security authority has the right to impose monetary, credit, or exchange directives upon the Central Bank is intended to keep monetary decision making separate from urgent commands and political pressure. Governments are often tempted to conceal budgetary problems, recession, or social dissatisfaction temporarily by pressuring the Central Bank, but in practice this merely transfers the cost to the whole society and to future generations. Article 95 seeks to ensure that monetary decisions are made on the basis of expertise, stability, and the long term interest of the country, and not on the basis of short term political advantage. The placing of the administration of the Central Bank in the hands of the Monetary Policy Council is intended to ensure that monetary power is not concentrated in a single individual. A collective structure reduces the danger of the personalization of decisions, susceptibility to influence, and error arising from individual will. When decision making is entrusted to a council, expert deliberation, internal restraint, and shared responsibility are strengthened. This design is of anti authoritarian importance for Article 95, because it does not permit one president, one minister, or one government alone to determine the course of the country’s currency. The method of selecting the members of the Monetary Policy Council is likewise designed to create a balance among expertise, popular representation, and institutional restraint. The fact that the House of Representatives requests the nomination of candidates from the faculties of economics of the universities of the country is intended to ensure that the entry point of the process begins through a professional and academic channel. The fact that the House of Representatives, from among the nominated candidates, introduces the principal members to the Senate is intended to ensure that the element of public representation and political responsibility is also present in the process. And the fact that the Senate elects the members by a vote of two thirds of its full legal membership is intended to ensure that no simple and temporary majority can easily seize control of the composition of the Central Bank. In this way, Article 95 seeks to establish a balance among a professional filter, a popular filter, and an institutional filter that creates stability.
The fact that the Senate, in the same process, selects one of them as the Chair of the Council and Governor of the Central Bank is also intended to prevent later ambiguity and conflict. In this model, the Governor is not imposed upon the structure from outside, but emerges from within that same professional and selected composition. This helps Article 95 by providing institutional legitimacy for the Governor and by ensuring that his position is defined from the outset within a collective and restrained structure. The provision of a term of membership of 9 years and its non renewable character for the members is one of the most important instruments of independence in Article 95. If a member knows that he does not need to secure the satisfaction of the government or of the political majority in order to renew his office, he is freer to make the correct but unpopular decision. Likewise, the rule that every 3 years, 3 members are replaced is intended to ensure that no government or short lived majority can seize control of the entire composition of the Central Bank within a short period. This gradual replacement preserves institutional memory and professional stability, while at the same time preventing the structure from becoming frozen and completely closed. The prohibition on simultaneous membership of the members of the Council in the government, Parliament, the executive leadership of political parties, the armed forces, the security institutions, or the possession of an effective interest in institutions supervised by the Central Bank exists in order to close the path to influence and to effective conflicts of interest. Article 95 understands that the danger does not come only from the government. Financial networks, partisan actors, and unelected centers of power may also distort monetary policy. For this reason, Article 95 seeks to keep the composition of the Council free from every dangerous dependency, so that its decision makers become neither instruments of politics nor instruments of private interests.
The strict rule regarding removal is situated within the same logic. The fact that the removal of the Governor or of any member of the Council is possible only in the case of proven corruption, a grave violation of the law, manifest incapacity in the performance of duty, or an effective conflict of interest, and even then only by a vote of two thirds of the full legal membership of the Senate, is intended to ensure that independence does not mean unaccountable immunity, while at the same time no political wave or simple majority is able to intimidate or remove the members. In this way, Article 95 seeks to establish a balance between accountability and independence.
In summary: Article 95 is intended to ensure that the Central Bank remains a professional and stable institution, free from political domination; an institution which, relying upon the Monetary Policy Council, a multi stage selection process, long and non renewable terms, gradual replacement, and strict conditions of removal, is able to safeguard the preservation of the value of the currency, the control of inflation, and the financial stability of the country against pressure from the government of the day, temporary majorities, and organized interests.
Rationale of Article 96 – Prohibition of Printing Money to Finance Deficits
Article 96 is established so that the government may not impose upon society the cost of fiscal indiscipline, budget deficits, and its short term political decisions by encroaching upon the Central Bank and creating money. If the government, whenever it faces a shortage of resources, can conceal its problem through printing money, creating credit, or the direct or indirect financing of the budget deficit, the usual result will be rising inflation, a decline in the value of the national currency, erosion of the purchasing power of the people, loss of public confidence, and the hidden transfer of the cost of government to the whole of society. This Article seeks to close that dangerous path at its root. The emphasis on the prohibition of printing money and creating credit exists so that the government may not, without accepting the political and legal cost of its own decisions, spend secretly through monetary means. Taxation is visible, borrowing is public, and reducing expenditures also requires responsibility. But creating money to cover deficits is a form of hidden financing whose burden falls upon the people in the form of inflation. For this reason, Article 96 has anti authoritarian significance, because it restricts one of the most important instruments used by undisciplined and authoritarian governments to preserve the appearance of stability and buy political time. The fact that Article 96 does not speak only of direct financing, but also prohibits indirect financing, is intended to close the paths of circumvention. The experience of countries has shown that governments do not always proceed by the simple and open route. At times, by pressuring the Central Bank to purchase government debt instruments, or by means of seemingly technical and banking arrangements, they achieve the same result. Therefore, Article 96 seeks to prohibit not merely the outward form of intervention, but its substance as well, so that the prohibition is real and effective, and not merely verbal. The express statement that the Central Bank may not become an instrument for financing the current expenditures of the government, compensating deficits arising from political decisions, or purchasing government debt in order to finance the budget is intended to make the same logic clear. The government must finance its expenditures through lawful, transparent, and accountable means: through taxation, lawful revenues, economy, or permitted and openly acknowledged borrowing. Article 96 seeks to make clear that the Central Bank is an institution for preserving monetary stability, not the government’s cash box and not a means for concealing budgetary errors. At the same time, Article 96 does not close every path in an absolute and rigid manner, but accepts only very limited and temporary exceptions in a state of war, national disaster, or severe financial crisis. The logic of this part is that, in wholly exceptional conditions, preserving the existence of the country or preventing immediate economic collapse may make temporary intervention necessary. But in order to prevent abuse, such an exception is possible only by a special law, for a defined period, and with the approval of two thirds of the legal membership of the House of Representatives and the Senate. These strict formal requirements exist so that no simple majority or sitting government may use ordinary conditions as a pretext for bypassing the principal prohibition.
The final part of Article 96, which declares every act contrary to it null and as giving rise to the legal responsibility of the relevant officials, exists so that this Article is not merely an ethical or economic recommendation. If violation of this Article were regarded only as improper, but had no legal consequence, then in times of crisis or political temptation it would easily be set aside. Article 96 seeks to guarantee that encroachment upon the boundary between the government and the Central Bank is both without effect and costly in legal and political terms for those who commit it.
In summary: Article 96 is intended to ensure that the government may not, through printing money, creating credit, or the direct or indirect financing of the budget deficit, impose the burden of its fiscal errors upon the people in the form of inflation and the decline in the value of the currency. This Article protects the independence of the Central Bank, the fiscal discipline of the government, budgetary transparency, and the purchasing power of the people, and closes one of the most important paths of financial authoritarianism and economic deception.
Rationale of Article 97 – Budget Transparency
Article 97 is established so that the revenues and expenditures of government do not remain hidden from the people, Parliament, and oversight institutions, and so that the budget becomes a document that is clear, intelligible, and subject to review. In every free system, political power is restrained not only by law, but also by the visibility of the path of money. If the people do not know what the government takes, what it spends, what debt it creates, what guarantees it gives, and what obligations it creates for the future, the government may, without real accountability, move public resources, create hidden debt, or keep its expenditures out of the sight of society. Article 97 exists to close precisely these paths.
The emphasis that the annual budget, its amendments, public debts, financial guarantees, future obligations, and all government revenues and expenditures must be clear, comprehensive, transparent, and subject to review is intended to ensure that the government cannot reveal one part of its financial reality while concealing another part. Many financial deviations begin at the point where only formal expenditures are visible, while future debts, hidden guarantees, or obligations outside the text of the budget are ignored. Article 97 seeks to place the complete financial picture of the government before the nation, not a selective and polished picture. The rule that no expenditure, financial obligation, transfer of public resources, or creation of public debt or guarantee is permitted outside the approved budget or without lawful authorization is one of the most important anti authoritarian elements of Article 97. Unaccountable governments do not become dangerous only through repression or censorship. At times, by creating parallel accounts, hidden obligations, or off budget expenditures, they effectively remove financial power from public oversight. Article 97 seeks to make clear that public money may be moved only through law and the formal budget, and that no officeholder or institution has the right to create a hidden treasury, a hidden obligation, or a hidden debt. The requirement that the budget must be published in detailed form, in a timely manner, in a comprehensible form, understandable to the public, and with the presentation of tables, charts, and percentage ratios exists so that transparency does not remain merely on paper. A budget that is published only in technical, complex, and unintelligible texts is in practice unusable for the public and does not create real transparency. Article 97 seeks to ensure that the people, the media, researchers, and representatives can understand not only the raw figures, but also the proportions, shares, and general direction of the budget. Tables, charts, and percentage ratios help transform the budget from a heavy administrative text into a real instrument of public oversight. The rule that all institutions using public resources, directly or indirectly, are subject to budgetary transparency and audit exists so that no affiliated, semi independent, public, or proxy institution may escape oversight by invoking its name, structure, or special legal position. In many systems, corruption and patronage begin precisely at this point: an institution uses public money but presents itself as outside government, outside the budget, or outside audit. Article 97 closes this path of escape and declares that the criterion is use of public resources, not the outward title of the institution.
The prohibition of the creation of any fund, account, budget line, or any hidden financial mechanism, outside lawful oversight, or for the purpose of circumventing the budget also exists to close one of the most dangerous instruments of corruption and financial authoritarianism. Wherever a hidden fund or an opaque account is created, there arises the possibility of patronage, the purchase of political loyalty, unlawful financing, and the bypassing of Parliament and the nation. Article 97 seeks to place all public money within a clear and traceable map, and to prevent the government or any other institution from constructing a dual or shadow financial system.
In summary: Article 97 is intended to make the budget the real document of the financial truth of government, rather than a cover for concealment. This Article protects financial transparency, public accountability, the prohibition of hidden debt and hidden obligations, the understandability of the budget for the people, and the closing of the path to shadow funds and accounts. Its ultimate purpose is to ensure that the financial power of the government remains visible and subject to restraint before the law, Parliament, oversight institutions, and the nation.
Rationale of Article 98 – Contingency Reserve and Financial Stability
Article 98 is established so that, in ordinary years, the government does not spend all of its revenues and so that the country is not left without support in the face of major crises. If the government spends everything it receives in the same year, then in times of war, national disaster, severe economic or financial crisis, sudden shock to government revenue, or acute nationwide recession, it will be compelled either to impose heavy and immediate taxation, to incur heavy debt, to pressure the Central Bank, or to cut public services abruptly. The purpose of Article 98 is to ensure that the country already possesses a real financial shield for difficult days. The requirement that the government annually retain a minimum of 2 percent and a maximum of 6 percent of annual public revenues as a contingency reserve and financial stability fund exists so that fiscal discipline is not merely a slogan. The minimum of 2 percent prevents the government from abandoning the principle of reserve accumulation for political or electoral reasons, and the ceiling of 6 percent ensures that the government cannot, under the title of reserve building, remove an excessive share of resources from the ordinary circulation of the budget and thereby impose artificial recession or unnecessary financial pressure upon the country. This part of Article 98 seeks to establish a balance between financial caution and economic equilibrium. The rule that the exact amount of this reserve in each year, within the stated limits, shall be determined by law exists so that the financial system of the country, while possessing a firm framework, also retains the necessary flexibility. In one year, the condition of the country may be ordinary and the minimum may suffice, while in another year, a revenue boom or looming dangers may require that a larger share be reserved. Article 98 seeks to establish a clear minimum and maximum, while entrusting the precise adjustment within the framework of law to the responsible institutions, so that there is both rule and the possibility of adaptation to economic realities.
The rule of accumulation of the reserve until it reaches a minimum of 150 percent of the average public expenditures of one year exists so that this reserve is genuinely meaningful and effective, and not merely symbolic and ineffectual. A reserve that lasts only a few weeks or a few months cannot play a real role in a great national crisis. By fixing this level, Article 98 seeks to ensure that the country possesses backing sufficient to withstand major shocks without immediate financial collapse or dangerous dependence. At the same time, because after reaching this level its increase, stabilization, or adjustment shall be determined by law, the Article also leaves open a rational path for reconsideration. Limiting withdrawals from this reserve to war, national disaster, severe economic or financial crisis, sudden shock to government revenue, or acute nationwide recession exists so that this account does not become the political cash box of the government. If the government can dip into this reserve whenever it wishes for ordinary expenditures, show projects, electoral promises, or to conceal its own mismanagement, the whole logic of the Article is destroyed. Article 98 seeks to preserve this reserve only for truly exceptional and national situations, and not for daily spending and political competition. The fact that withdrawal is possible only by special law and with the approval of two thirds of the legal membership of the House of Representatives and the Senate is one of the most important anti authoritarian parts of Article 98. This high threshold and these strict formalities are intended to ensure that no sitting government, ruling party, or simple majority may easily encroach upon these resources. Put plainly, Article 98 seeks to ensure that withdrawal from the contingency reserve is the result of a national and extraordinary determination, and not the easy and ordinary decision of the government. The express prohibition of using this reserve for ordinary current expenditures, electoral spending, expansion of the government, or compensating deficits arising from misadministration and political decisions also exists to close the path of abuse. This part of Article 98 makes clear that the contingency reserve exists to save the country from crisis, not to save the government from its own mistakes. This distinction is at once anti corruption, anti populist, and anti financial authoritarian.
Finally, the requirement that the account of this reserve be transparent, auditable, and under the supervision of the Court of Audit exists so that the reserve itself does not become a dark and untouchable point of financial power. Wherever large sums of money exist and oversight is weak, the danger of corruption, patronage, and hidden use rises. Article 98 seeks to ensure that even this national safeguard remains within the framework of transparency, accountability, and public audit.
In summary: Article 98 is intended to ensure that, in ordinary years, the country sets aside part of its public revenues in an orderly manner and builds a real contingency reserve and financial stability fund, a reserve that may be used only in major crises and only through strict formalities. This Article protects fiscal discipline, the stability of the country in times of crisis, independence from sudden pressures, and the prohibition of political misuse of public resources, and it constitutes one of the most important barriers against governmental extravagance and financial authoritarianism.
Rationale of Article 99 – Taxation and Its Rate
Article 99 is established so that the tax system of the country remains clear, limited, predictable, and subject to restraint, and so that the government may not, in the name of taxation, impose an unlimited and arbitrary financial burden upon the people and businesses. In a free system, taxation must be an instrument for financing the necessary expenses of government, not an instrument for the endless expansion of the state, political pressure, or the concealment of inefficiency. For this reason, Article 99 places taxation from the outset within the framework of law, justice, transparency, certainty, and the right of objection. The emphasis of Article 99 on transparency and on the obligation of the government to publish the manner of expenditure of tax revenues with tables, charts, and percentage ratios is intended to ensure that the people are not merely payers, but also know precisely where the money taken from them is spent. Without this transparency, taxation becomes a dark treasury of power. Article 99 seeks to make the relationship between citizen and government in matters of taxation one based on knowledge and accountability, and not on obscurity and raw coercion. The requirement that every increase or decrease in taxation must be accompanied by a clear statement of the reason, amount, and the section of public expenditure affected by it exists to close the path to hidden, propagandistic, and deceptive decisions. The government must not raise taxes without openly stating why and for which expenditures it does so. Nor may it turn tax reduction into a political slogan while reimposing the same burden by another route. Through this mechanism, Article 99 turns taxation into a reasoned and reviewable decision. The placement of a ceiling under which, in ordinary conditions, tax on the income of persons and enterprises and sales tax may not exceed 10 percent exists so that the government is compelled, instead of relying on the continual increase of the tax burden, to move toward efficiency, economy, and better administration of the country. Article 99 deliberately places a clear boundary so that the government may not, whenever it wishes, choose the easiest path, namely increasing taxation from the pockets of the people and producers. This part of Article 99 is anti authoritarian because it restrains one of the principal instruments of the unchecked expansion of governmental power.
The separation of payments relating to insurance, health, and pensions from income tax, while at the same time limiting their combined total to 15 percent of total income, exists so that the government may not, by changing the name, restore the same financial pressure through another door. From the point of view of the people, what matters is not merely the legal title of the deduction, but how much is taken from their total income. Article 99 closes this route of evasion and makes clear the real ceiling of financial pressure on income. The rule that, in determining tax rates, the lower rate is to be preferred over the higher rate, shows the value orientation of Article 99. This sentence means that the principle is to keep society lightly burdened, not heavily burdened. That is, wherever there is a choice between increasing the tax burden and governing more efficiently, the course must be chosen that places less pressure on the people and on economic activity. Another important part of Article 99 is that no person, institution, activity, income, property, or good is outside the scope of taxation and general levies, and that the creation of any exemption, exception, preferential reduction, or tax privilege is prohibited and void. The logic of this part is to close the way to patronage and discrimination. In many systems, the problem is not only that taxation is high. The problem is that ordinary people pay taxes while groups close to power, special institutions, or privileged activities escape payment. Article 99 seeks to make taxation a general law, and not an instrument of discrimination and privilege. The provision for the conditions of war or national emergency in Article 99 exists so that the Constitution remains realistic and accepts that, in extraordinary conditions, the country may temporarily require greater resources. Yet even this exception is deliberately tightly confined. Temporary tax increases are possible only by a special law and with the approval of two thirds of the legal membership of the House of Representatives and the Senate. This heavy threshold exists so that the government may not treat every ordinary problem or its own mismanagement as a pretext of “emergency.” The rule that, even in such circumstances, income tax on persons and enterprises may not exceed 20 percent, that sales tax still may not exceed 10 percent, and that the combined total of income tax and payments relating to insurance, health, and pensions may not exceed 25 percent of total income, exists so that even in difficult conditions the boundary of the government’s financial reach remains clear. Article 99 accepts that crisis may demand greater pressure, but it does not permit crisis to become a pretext for completely unbinding the hands of government.
The condition that continuation of this increase after each 4 months is dependent upon renewed approval by two thirds of the legal membership of the House of Representatives and the Senate is one of the most important anti authoritarian locks of Article 99. This rule does not allow emergency taxation to become permanent taxation. The government must repeatedly prove the necessity of its continuation, and the heavy parliamentary majority must each time accept it anew. This mechanism keeps the exception genuinely temporary.
In summary: Article 99 is intended to ensure that taxation in the country is limited, clear, general, transparent, and open to objection, and not heavy, obscure, discriminatory, or patronage based. By setting a clear ceiling for income tax and sales tax, limiting the total amount taken from total income, prohibiting all forms of exemption and tax privilege, and making the conditions for temporary tax increases in times of war or national emergency stringent, Article 99 compels the government, instead of growing larger from the pockets of the people, to move toward efficiency and accountability.
Rationale of Article 100 – Court of Audit
Article 100 is established so that oversight of the budget, the use of public resources, public contracts, and compliance with financial law is taken out of the hands of the very institutions that spend the money and entrusted to an independent authority. If the government or the agencies that consume the budget are themselves the final supervisors of their own expenditure, the way is opened to corruption, concealment, discrimination, and the waste of public resources. The existence of the Court of Audit means that public money is not ownerless and must be accounted for before the nation and the law.
The fact that the Court of Audit is recognized as the independent public auditing authority of the country is intended to ensure that financial oversight does not become an instrument of the government of the day. The independence of this institution is a necessary condition for detecting violations, issuing clear reports, and preventing the budget from becoming a source of patronage and power networks. Article 100 seeks to make clear that no institution, merely by reason of political or administrative power, is immune from financial audit and review. Entrusting the election of the President of the Court to the Senate by a vote of 60 percent of its full legal membership is intended to ensure that his selection is not made by a simple and partisan majority, and that a person is chosen who can command broader confidence. At the same time, this threshold is lighter than two thirds so that the process of selection does not become deadlocked. The logic of this part is to create a balance between independence and practicality: not so easy that it becomes wholly political, and not so difficult that the election of the President of the Court becomes impossible. The fact that the removal of the President of the Court is possible only in the case of proven corruption, grave violation of the law, or persistent incapacity in the performance of duty, and even then only by a vote of 60 percent of the full legal membership of the House of Representatives, is intended to ensure that the President of the Court is neither defenseless before a political wave nor exempt from accountability. Entrusting removal to the House of Representatives has its own logic as well: because the Court of Audit supervises the expenditure of public resources, its ultimate accountability must be connected to the institution that is the direct representative of the people. This design seeks to establish a balance between stability of office and popular accountability. The express provision that the Court has an independent budget, professional staff, and a full right of access to the financial documents of institutions using public funds is intended to close the path to obstruction of its work. If the auditing institution is dependent, in respect of budget, personnel, or access to documents, upon the very agencies that it must examine, its independence becomes merely nominal. Article 100 seeks to place in the hands of the Court the real instruments of oversight, and not merely its name.
The final part of the Article, namely that the reports of the Court must be public and accessible to all, is one of its most important anti corruption and anti authoritarian elements. An audit that remains in a drawer does not have its full effect. The publicity of the reports ensures that the people, the media, Parliament, researchers, and judicial authorities can pursue, demand accountability, and conduct proceedings on the basis of those very reports. This transparency both raises the cost of corruption and strengthens public confidence in the financial order of the country.
In summary: Article 100 is intended to ensure that public resources are subject to real, independent, and public oversight, oversight that is neither in the hands of the government nor toothless and merely ceremonial. In this Article, the Court of Audit is the instrument for restraining financial corruption, preventing budgetary concealment, and defending the right of the nation in public property.
Rationale of Article 101 – Competition, Prohibition of Monopoly, and Tariffs
Article 101 is established so that the economy of the country does not become the domain of monopoly, organized patronage, and the dangerous linkage between political power and economic power. In any society in which the market is concentrated in the hands of a few actors close to the government, affiliated institutions, or holders of power, the result is diminished competition, lower quality, higher prices, reduced choice for the people, and the weakening of economic freedom. Article 101 seeks to make clear from the outset that a free economy does not mean abandoning the field to the powerful. Rather, it means real competition within the framework of the law and the prohibition of the corrupting concentration of economic power. The emphasis on the prohibition of monopoly, anti competitive collusion, abuse of dominant position, and any form of economic concentration that disrupts free competition, consumer rights, or the economic independence of the country exists because the danger lies not only in state ownership or direct price setting. The greater danger is that a limited group may, through financial influence, political connection, or market power, close off the paths of production, distribution, and pricing for its own benefit. Through this prohibition, Article 101 protects the people against the emergence of an economic class immune from competition and law. The express statement that the government has no right to create, support, or preserve monopoly for persons, companies, public institutions, military institutions, or affiliated institutions is the anti authoritarian core of this Article. In many countries, monopoly does not arise only out of the free market. It arises out of government support. That is, the government, through licenses, tariffs, privileges, patronage, or by closing the way to competitors, creates a secure market for favored groups. Article 101 seeks to render this linkage illegitimate at its root and to declare that the government must not only refrain from being a monopolist itself, but must also refrain from supporting private or شبه دولتی monopoly. The provision for an independent authority for competition and the prohibition of monopoly exists so that the implementation of this Article is not left to the changing will of the government of the day. If the very bodies that may benefit from creating or tolerating monopoly are themselves the authority that determines and combats it, the Article becomes ineffective. The existence of an independent authority means that competition and consumer rights require a professional institutional guardian separate from the principal actors of political and economic power.
The fact that the head and members of the high board of this authority are chosen through nomination by the House of Representatives and a vote of 60 percent of the legal members of the Senate is intended to create a balance between popular representation and institutional restraint. The House of Representatives, as the institution arising from the direct vote of the people, has the role of entry and nomination so that the selection is not completely detached from political society and unaccountable. The Senate, with a 60 percent vote, plays the role of a filter of stability and rigor so that the selection is not reduced to a simple and merely partisan majority. This mechanism seeks, on the one hand, to keep the anti monopoly authority legitimate and accountable and, on the other hand, to keep it from the rapid capture of a single political faction. The conditions of professional qualification, integrity, independence of judgment, and the absence of conflict of interest also exist so that the anti monopoly authority itself does not fall into the hands of holders of economic influence. A person entangled in hidden interests, relationships with large companies, or dependence upon centers of economic power cannot be an impartial judge of competition. This part of Article 101 seeks to ensure that the defender of competition is not itself captive to anti competitive networks. The emphasis that no government official or holder of economic power has the right to interfere in the expert decisions of this authority exists to close the path of political and economic pressure. In practice, an anti monopoly authority has meaning only if it is able to decide against large and influential actors. If every minister, official, or major holder of capital can alter the course of decisions through influence, Article 101 becomes a mere ineffective legal ornament. This part is therefore necessary for preserving the independence of decision making and the institutional courage of the anti monopoly authority. The requirement that the decisions of the authority be reasoned, public, and subject to challenge before the competent court exists so that anti monopoly power itself does not become an arbitrary and unaccountable instrument. The anti monopoly authority must be strong, but it must make its reasons public and remain answerable before the courts. This part establishes a balance between regulatory authority and the rule of law. The part concerning tariffs is carefully included in Article 101 within this same logic. The government must be able to defend the national economy against dumping, artificial suppression of currency value, or other harmful trade practices by foreign governments. But this same tariff instrument, if left unrestrained, can lead to the creation of domestic monopoly, the preservation of inefficient production, and the imposition of low quality goods upon the people. Article 101 seeks to preserve this balance: a tariff is legitimate only for defense against harmful foreign conduct, not for permanently closing the market in favor of domestic groups. For this reason, it is expressly stated that tariffs must not lead to the creation of domestic monopoly, the protection of inefficient production, or the imposition of low quality goods upon the people. This part is the result of the same anti authoritarian view: the government must not, under the pretext of supporting production, acquire the power to trap the people in a closed market and extinguish competition. Support is legitimate only when it is consistent with consumer rights, fair competition, and the real improvement of quality.
The requirement that a tariff be temporary, reasoned, proportionate, public, and subject to review and judicial examination exists so that support for domestic production does not become a permanent patronage. A tariff, if endless, without reason, or incapable of challenge, very quickly changes from an instrument of economic defense into an instrument of corruption and discrimination. Article 101 seeks to give the government a defensive hand in this field, but not an unrestrained and arbitrary hand.
In summary: Article 101 is intended to ensure that the future economy of Iran is neither placed in the hands of domestic monopolists nor left defenseless against harmful foreign trade practices. This Article protects free competition, consumer rights, the prohibition of linkage between government and monopoly, the independence of the anti monopoly authority, and the limited and conditional use of tariffs, so that both the economic freedom of the people and the economic independence of the country are safeguarded.