Investigating the Impact of Tax Revenues (Tax Expenditures) on Iran's Economic Growth

Taxes constitute the main sources of government revenue on one hand and, on the other hand, are one of the most important financial policy tools and can play a key role in economic growth and development. Therefore, it is important to identify tax payment potential as a step towards achieving these revenues. However, part of the tax revenue cannot be collected for legal and illegal reasons. In other words, this part of taxes may be lost (tax expenses). The purpose of the present study is to investigate the effect of these lost income (tax expenditures) on Iran's economic growth. For this purpose, the period of 2009-2012 was used as a sample data for a simulation to predict this tax expenditure, which the country is still suffering. To this end, the Randomized Bayezian Coefficients are applied. The findings indicate that the estimation of tax expenditure in the economy is different from one period to another period. However, the impact of tax expenditures on growth is low and also negative. The greatest impact on growth was in 2010.