One of the main reasons for implementing a Value Added Tax (V.A.T.) in a country like Iran, where one’s effective tax rate is directly proportional to how corrupt the tax authority is and what portion of one’s “tax savings” one is willing to share with that corrupt tax authority, is that the V.A.T. is not susceptible to tax cheats and unscrupulous and dishonest tax authorities. The way Mr. Ahmadinejad should handle the implementation of the V.A.T., and deflect resistance to it, is to engage in “chak-o-chooneh” or bargaining, and specifically he should bargain away taxes which are most susceptible to cheating (like the inheritance tax), in return for establishing the V.A.T. . It becomes increasingly difficult for opponents of the implementation of the V.A.T. to counter it when it is presented as a replacement for an inefficient tax versus being presented strictly as an additional tax.
