Al-Sudani: We have achieved a breakthrough in increasing non-oil resources.

Al-Sudani: We have achieved a breakthrough in increasing non-oil resources.

08/26/2025

Prime Minister Mohammed Shia al-Sudani announced that tax revenues will increase by 26 percent in 2024 compared to the previous year, stressing that no tax increase will be allowed that would create a business-repellent climate. He also announced at the same time that the government has succeeded in achieving a significant leap in increasing non-oil resources. This came during his sponsorship yesterday, Monday, of the “Tax Conference for Economic Development and Activating the Investment Environment,” which was held in the capital, Baghdad, and attended by “Al-Sabah.”

Prime Minister’s speech

In his opening remarks at the conference, Al-Sudani noted that “the government has given the greatest attention to reforming and sustaining the economic sector, and that the gateway to this reform is supporting the private sector by providing an attractive environment for investors and capital, adopting global standards for doing business and tax accounting, and ensuring that these standards are flexible and fair.”

He explained that “the world is moving today toward unifying tax procedures and laws to align with international standards,” emphasizing “Iraq’s progress in this area, which opens the door wide to foreign and local investors, strengthens partnerships with the private sector, and instills confidence in the Iraqi market.”

He stressed that “the biggest challenge facing us is the priority of economic reform and the transition to a state that relies on a diversified economy,” explaining that “we have a public spending budget for each fiscal year of approximately 150 trillion dinars, with tax revenues of 3 trillion dinars. These figures require a pause and review.”

The Prime Minister continued, “Economic reform decisions were exploited through slogans, an atmosphere of deception, and pressure on official institutions,” adding, “We sponsored the conference on reforming the tax system in Iraq, which was held in December 2023, and resulted in a package of important recommendations.”

He pointed out that “Cabinet Resolution No. 24074 of 2024 put the tax reform packages into effect, followed by the formation of the Supreme Committee for Monitoring Tax Reform,” noting that “our efforts have resulted in international interest from international investors in tax reform in Iraq.”

He added: “We also worked to increase non-oil resources despite our great caution, due to the lack of a supportive political or social environment, as we succeeded in achieving a significant leap in increasing non-oil resources, the index of which rose from (7 percent) in 2022, to (14 percent) in 2024,” and continued: “We will not allow a tax increase to occur that leads to the creation of a climate that repels businesses, or at the expense of fairness in imposing taxes.”

Al-Sudani pointed out that “tax revenues increased in 2024 by (26 percent) compared to the previous year, and increased by (3 percent) in the first half of the current year compared to the same period last year,” indicating that “the digital transformation contributed to enhancing tax capacity and accuracy.”

He explained that “the tax inquiry platform has put an end to the mismatch of names, delays, and corruption, and has undermined taxpayers’ confidence in the accuracy of tax procedures. A system for tax payment receipts and their electronic matching after tax assessment has also been implemented, which was previously done on paper.”

He stated that “there is communication with specialized and reputable international companies to work towards achieving the highest international standards in the tax system,” noting that “the draft of the new income tax law adopts international standards while adhering to the goal of social justice and tax exemptions for those with the lowest incomes.”

The Prime Minister affirmed that “the provisions of the new law, which will soon be enacted, will be business-friendly, supportive of the green economy, and provide incentives for start-ups.” He added that “the Supreme Committee for Tax Reform has prepared a policy paper on tax accounting for oil companies to address problems and remove obstacles to their operations.”

He noted that “the unification of tax procedures between the federal government and the Kurdistan Regional Government of Iraq has facilitated the processing of tax files for universities and private banks,” emphasizing that “the reforms being achieved are a message to citizens to support their political system and manage resources optimally.”

The conference aims to highlight the 2025 Tax Reform Plan and its impact on the national economy, discuss the challenges of the current tax system and modern digital and regulatory solutions, enhance public-private partnerships in tax collection, and support investors by building a transparent and investment-friendly tax system.

Tax forecasts

Meanwhile, Prime Minister’s Advisor Abdul-Hussein Al-Anbaky expects tax revenues to increase to 4 trillion dinars this year. Al-Anbaky, head of the Higher Committee for Tax Reform, said on the sidelines of the tax conference attended by Al-Sabah: “Tax revenues witnessed a 26 percent increase in 2024 compared to 2023,” noting that “the first half of this year witnessed a 3 percent increase in tax collection rates compared to the same period last year, which confirms a 29 percent increase over the two years.”

The past.

He added, “Tax revenues are expected to increase to 4 trillion dinars this year, after exceeding 3 trillion in 2024,” noting that “these percentages do not include the revenues of oil companies, which are usually large because they were granted an extension to complete their data.” Al-Anbaki explained, “There are problems with tax policies, administration, and legislation, and we are performing a surgical operation to address them,” stressing that “the committee has a long way to go to reach the end of tax reform.”

digital transformation

For his part, Director of the Cybersecurity Center, Ali Hussein Hamdallah, said the center is a supportive partner for all digital transformation efforts.

Hamdallah added to Al-Sabah that “this center is located in the tax collection department,” noting that “all existing tax inquiry platforms are cyber-secured.” He explained that “the establishment of this center by royal decree has begun to play its role in this field by examining systems and ensuring that strategies and policies are developed that contribute to securing the tax sector.”

Haider Al-Omran, head of the Baghdad Digital Transformation Council, confirmed coordination with the Ministry of Finance to bring in international companies to oversee the digital transformation of the tax sector.

Al-Omran added to Al-Sabah that “these companies are among the top five in the world, and they have been placed in the hands of the Ministry of Finance to select one of them to be responsible for the digital transformation and tax automation.” He explained that “the Council continues to develop the state’s financial management through modern programs approved in all developed countries,” noting that “digital transformation and electronic payments are among the important issues for increasing transparency and financial inclusion.”

Al-Omran noted that “what matters most at the present time is the tax sector’s transition to comprehensive automation with reliable software that closely links taxpayers and beneficiaries.”

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