Public transport prices: a never-ending loop

Tehran Municipality and Tehran Taxi Organisation are struggling to set new public transportation prices for the coming Iranian fiscal year, starting March 21.

Tehran Taxi Organisation claims that next year’s tariffs must increase according to the inflation rate which is expected to be very high. Tehran Municipality, on the other hand, says that it cannot permit dramatic jumps in prices as passengers will not be able to afford it.

Therefore, the Municipality suggests supplementing increases in prices to some extent with providing some facilities to drivers; such as selling tires and spare-parts for their cars at manufacturing prices or providing low-rate loans, etc.

However, the problem of public transportation prices for the Municipality is not limited to taxis. Subway tickets in Tehran costs only 10,000 rials for each ride (nearly 10 USD cents). According to Mahmud Mirlohi, a Member of Tehran City Council, the real cost of each ride with Tehran Metro is 100,000 rials, i.e. ten times more.

But eliminating vast subsidies in transportation is almost impossible because many passengers will not be able to afford the new prices.

The gap between realistic prices in transportation in Iran is getting bigger every year. It therefore implies huge costs on the government who cannot clear its debts with relevant organisations; a never-ending loop.