As Iran's legislature is debating the budget for the coming Iranian year, questions remain about the feasibilty of the proposed figures and its heavy reliance on oil revenues.

The budget bill for the next Iranian year that starts March 21 was submitted to the parliament Dec. 8 with the headline numbers having massively ballooned compared to the current year's Budget Law.

The figures for tax revenues, oil and gas income, and financial assets sales — major sources of government revenue — spiked about 25%, 109.6% and 139%, respectively, against the current year's budget. Spikes of this magnitude have been unprecedented in the budget proposals of preceding years. Besides, current expenditures have gone up massively by more than 46% to 637 trillion tomans ($24.5 billion at the free exchange market rate of 25,950 per US dollar), of which more than 73% is determined to be allocated to employees and retirees' payrolls. It appears that the Rouhani administration has developed an expansionary draft budget with optimistic assumptions for state oil revenues next year as US President-elect Joe Biden takes office.

Unfortunately, direct reliance on petrodollars has doubled in the budget proposal as one-fourth of the earnings in rial terms are banked on oil sales. The government has projected that 225.2 trillion tomans ($9.7 billion) of the government's general resources will be financed through the sale of its underground resources. This is while the figure for this item in the current year's Budget Law stood at 107 trillion tomans ($4.1 billion). This suggests that the 2021-22 budget may be closed on the assumption that sanctions will be lifted as the government estimates that the number of barrels of oil to be sold might touch 2.3 million per day, getting back at the level of the country's oil sales in 2018 and prior to the unilateral US sanctions. However, The Economist recently in a report forecast oil exports for Iran of 440,000 barrels per day during the 2021-22 calendar year.