This move, which comes in the wake of escalating confrontations with Israel, is seen as a strategic measure to reinforce national security. “Given the need to address our defense needs, we are witnessing a significant increase exceeding 200% in the national military budget,” Mohajerani stated in a press briefing.
While no exact figures have been released for the 2025 allocation, this proposal highlights Iran’s focus on maintaining its military standing, despite a fraught domestic economy. The budget hike is anticipated to support key military entities, including the Islamic Revolutionary Guard Corps (IRGC) and its elite Quds Force, which are active across the region. Traditionally, Iran’s military budget includes not only the army and the IRGC but also the Basij forces, with undisclosed funds often directed to international operations.
The 2023-2024 budget allocated around 470 trillion tomans ($28.5 billion) for military expenditure, with provisions for the armed forces to independently trade crude oil and supplement their budget. This unique practice, allowing the military direct access to national resources, highlights the priority given to defense over other public spending.
#Iran’s 1404 Budget Proposal: Fuel Price Hikes, Defense Spending Boost, and Increased #Taxation Amid Economic Strainhttps://t.co/VCpOvCO4YV
— NCRI-FAC (@iran_policy) October 22, 2024
In recent years, under the direction of Masoud Pezeshkian, a larger share of Iran’s oil revenue has been channeled into defense, reflecting a strategy to expand regional influence. This approach has sparked criticism from economic analysts who argue that critical domestic needs are being sidelined. Observers like the Stockholm International Peace Research Institute (SIPRI) note that actual military spending often surpasses official estimates, with Iran’s defense expenditure totaling around $10.3 billion in 2023.
The proposal for increased military funding arrives as tensions with Israel continue to rise. After a series of reciprocal rocket attacks in October, Israel launched airstrikes targeting Iranian military installations, with international satellite images confirming damage at key sites like Parchin and Khojir. In response, Iran has reaffirmed its readiness for future conflicts, warning that any further aggression would provoke an “unpredictable” retaliation.
Taxation and #Tax Evasion Turns into Battleground between State and #Iran’s Populationhttps://t.co/sTudCY75UG
— NCRI-FAC (@iran_policy) February 12, 2024
Public reaction within Iran is split. Many Iranians, already struggling under high inflation and economic instability, view the budget increase with skepticism, especially given new tax hikes for the 1404 fiscal year, which some argue unfairly impact ordinary citizens. Yet, officials stress the importance of defense spending, with Mohajerani acknowledging the role of military forces in safeguarding national stability. As regional tensions mount, Iran’s focus on military resilience remains unwavering, signaling continued prioritization of defense despite calls for greater economic relief.
