It has been about three years since the tax authorities have been involved in collecting taxes from bloggers and influencers. However, practical proposals have not yet been implemented, and there is no precise news regarding the taxation of bloggers.
According to IDEA, In February-March 2021, members of parliament agreed with the proposal of one of the representatives to tax influencers. At that time, it was stated in the Budget Law’s Clause 6 that the income of users with more than 500,000 followers on user-centric media would be subject to income tax on advertising revenue.
The tax authority has been obligated for about three years to prepare the executive instructions for taxing professional media users’ income from advertising revenue within two months of the necessary implementation of this clause and obtain the approval of the Minister of Economy. The tax authority was also required to prepare the list of taxpayers and their self-declarations and make them public on its website. However, after a long period of time, this law has not been fully implemented.
This matter did not become operational to the extent that on August 18, 2022, the Research Center of the Islamic Consultative Assembly proposed the draft of the responsibility of endorsers in commercial advertising to the legislative branch for the first time, as the first serious step towards controlling social media figures in the advertising field under the title “endorsers.”
Identity of Iranian Influencers
This draft, which was published on the official portal of this center along with the expert opinion on August 9, 2022, has specified that the endorser in this proposed law is anyone other than the advertising requester, such as athletes, actors, doctors, influential users, etc., who introduce and endorse the goods or services of others and confirm and endorse their features, quality, effectiveness, or specific results. All categories covered by this law in the country that advertise goods or services on social networks are, in fact, those influencers. It was the first time in the country that a unique identity was given to Iranian influencers.
According to the spokesperson of the tax authority, when this clause was approved, 123 influencers had approximately 2.3 trillion Tomans in income. By that time, the officials of the tax authority promised that this year taxes would be collected from bloggers and influencers, which did not happen.
After seven months of this proposal, in February 2023, the tax authority announced the provincial tax statistics of influencers for the first time. According to this organization, 123 influencers should pay approximately 17 billion Tomans in taxes.
The spokesperson of the tax authority explained at the same time about the amount of taxes collected from these identified influencers that the 17 billion Tomans is not necessarily the tax on 2300 billion Tomans, and it is for some individuals. The tax authority predicted that the income of many of them is more than this amount. For example, around 500 billion Tomans can be collected from celebrities. Because the income of these individuals is considered advertising-income, about 45% of the profit ratio will be considered after deducting expenses to determine the income.
Identification of Bloggers by the Government
After several weeks, the government’s economic spokesperson explained that the government is currently identifying high-income celebrities in the virtual space. Up until that point, which was July 2023, 550 active individuals with very high incomes have been identified. Among them, 123 individuals had advertising income exceeding 2,300 billion Tomans. Out of these 123 individuals, approximately 2,300 billion Tomans of income from advertising received in their bank accounts were identified.
With all the laws and clauses that have been added, it appears that a significant portion of influencers have still not filed their tax returns, and some individuals who have done so have hidden their income. In this regard, Shahin Mostofi, the Director-General of the Audit Office of the Tax Affairs Organization, told Tasnim: “We need to first reach their income, and then calculate the tax. In this way, it is possible to identify the income of this group of taxpayers through various channels, including bank accounts, social media accounts, and information available to the Tax Affairs Organization.
The Director-General of the Audit Office of the Tax Affairs Organization stated that after identifying incomes, and because no expenses have been declared by them, the Tax Affairs Organization is forced to use the profit ratio for their activities, saying: “The profit ratio for the activities of these influencers, referred to as the income of individuals, in any form of advertising and advertising in the virtual, media, and environmental space, is specifically determined, and this profit ratio is set at 70 percent. As a result, our colleagues use a 70 percent coefficient to deal with the activities of influencers.
Profit Ratio for Advertising Companies is 45 Percent
Another profit ratio is set for individuals who conduct marketing activities on their own in the virtual space or for companies that specifically perform marketing for another company or a specified producer. This is considered under marketing various domestic goods and services with a profit ratio of 45 percent. In this way, the activities of these individuals are clear.
In other words, influencers advertise non-environmental products based on their access in the virtual space, and if the Tax Affairs Organization reaches the income of this group of taxpayers, they use a 70 percent coefficient. However, some companies that specialize in advertising have a 45 percent coefficient.
A 40 Hemat Reduction in Taxable Incomes Based on a Single Clause of the Budget Law
According to the Director-General of the Audit Office of the Tax Affairs Organization, companies are exempt from tax if they do not distribute profits. Currently, based on the rulings received through judicial authorities and in accordance with the Tax Affairs Organization, if the Tax Affairs Organization applies tax exemptions, it is in accordance with the law. One of these laws that led to the reduction in tax revenues this year was the provision of paragraph (h) of Clause 2 of the Budget Law.
The Director-General of the Audit Office of the Tax Affairs Organization stated that this clause allows companies not to pay taxes if they do not distribute profits. It is estimated that about 40 to 45 trillion Tomans of taxable revenues have not been collected due to this provision of the Budget Law. It seems that about 460 trillion Tomans of tax exemptions have been declared in total tax returns.
Businesses on Domestic Platforms Exempt from Taxes
All the laws and clauses mentioned apply only to bloggers and businesses operating on foreign platforms, as, according to the decision of the parliament, businesses operating on domestic platforms approved by the Ministry of Communications and Information Technology are exempt from taxes. Businesses operating on foreign platforms are required to pay taxes.
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