The Effect of Privatization on Tax Revenues in Iran

Achieving positive economic consequences among national economies has induced governments to adopt structural reforms, economic re-engineering and privatization. The privatization policy in micro level has been examined in a large number of researches; however the macroeconomic effects of privatization, especially the effect of privatization on tax revenues, have been neglected. For the period of 2004-2014, this study tests the hypothesis whether privatization affects tax revenues in Iran. Using GMM, the estimation results show that privatization reduces tax revenues. This finding contradicts theoretical expectation