Arthur Millspaugh's Income Tax Law

The American advisor, Dr. Arthur Millspaugh’s, travelled to Iran in 1943 accepting the Iranian government invitation to organize the existing economic chaos. He was on the belief that balancing the budget and controlling the inflation required incurring high taxes on high incomes. So, he proposed the income tax bill to the National Consultative Assembly. On November 11, 1943, the Assembly passed the bill, which consisted of 27 paragraphs. The new tax rates were based on the American tax system, but the individual exemptions, wrong declaration statements, and the loss resulted by the delayed payments were among the barriers to execution of the new law. The present study was a descriptive-analytical research based on the historical data, which was collected using the sources available at the National Library and Archives of the I.R of Iran, Center for International Research and Education of the Ministry of Foreign Affairs, the debates at the 13th and 14th terms of the Iranian National Assembly, the archive of the Ettelaat Newspaper for the years 1943 and 1944. The main research question was what the provisions of the income tax law, set by Millspaugh, were and what reactions different classes of people showed to that.