A strike in Tehran’s Grand Bazaar in protest against higher taxes has entered its second week even though the government has backed down in the standoff.

The value added tax, VAT, rate for Iranian bazaar traders will stay at the 2008 rate with only a 15 percent hike, head of Iran’s Guild Council, Qassem Nodeh Farahani said, according to Iranian broadcaster Press TV’s English language website.

The decision was announced in a meeting between Iran’s State Tax Affairs Organization and the Guild Council where the officials confirmed an increase of the tax rate by 15 percent this year.

"In today’s meeting, all previous agreements, including the proposed 75 percent hike in the income tax was completely revoked and a clear guideline on tax payment of the guilds was assigned," Farahani said Monday.

The government’s proposal to raise the 2009-2010 market tax rates led to a strike that began July 6 in the capital’s main bazaar. The protesting traders described the 75 percent tax hike as "unfair."


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