MK (Yahadut HaTorah) who chairs the Knesset Finance Committee feels the taxation system in Israel is bad and there is no reason to make it worse, referring to the planned tax hikes voted upon by the cabinet today. Gafne feels the major corporations should pay an additional 0.5% tax instead of increasing the value added tax from 16% to 17% since the latter delivers yet another difficult blow to the already over taxed middle class.
Gafne points out that the Trachtenberg Commission recommended raising corporate tax but the treasury remains adamantly opposed to such a move. Finance Ministry Director-General Doron Cohen is opposed to raising the corporate taxes, and recently explained that the current financial situation does not permit taking such a step. Cohen feels the tax increase is not unreasonable, adding “life isn’t easy”, seeking to play down the planned increase amid shouts the government is delivering a fatal blow to many families that already find it difficult to meet monthly expenses.
Treasury officials add that one earning 9,000 NIS monthly will be compelled to pay 11 NIS additional tax, no more.
Gafne met on Sunday, 17 Menachem Av with Director-General of the Prime Minister’s Office Harel Locker in an effort to reach agreement. Locker realizes that without Gafne’s support, the new tax law would be locked in the Finance Committee instead of being pushed along for approval by the committee and in Knesset.
How Much More Tax Will One Pay Monthly & Annually?
Monthly income of 11,000 NIS = 11 monthly (132 annually)
Monthly income of 12,000 NIS = 31 monthly (372 annually)
Monthly income of 15,000 NIS = 61 monthly (732 annually)
Monthly income of 20,000 NIS = 111 monthly (1,332)
Monthly income of 40,000 NIS = 311 monthly (3,732)
Monthly income of 100,000 NIS = 996 monthly (11,952)
(YWN – Israel Desk, Jerusalem)
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4 Responses
Have businesses shoulder a bit more taxes. The VAT is so high already.
In all fairness, most Israelis oppose their tax system. On the other hand, they all favor the welfare system. It’s nice that there is something all Israelis can agree on.
While Greece and Italy probably get the gold and silver medals in this category, Israel deserves at least a bronze. No matter how much frum conservative might want, the “tea party” concept of fiscal responsibility is one idea unlikely to ever get exported to Israel.
Gafne is a financial illiterate.
President Ronald Reagan proved that by REUCING TAX RATES, more money comes into the treasury, because businesses have more incentive to expand and grow volume and exports.
Israel is still stuck in a socialist time warp going back to its Kibbutznick roots.
The result is uneccessary hardship for families struggling to keep afloat financially.
Will someone please tell Gafne to wake up and smell the coffee!
Corporations do not pay any taxes, ever. On the contrary they make money from tax collections and in the old days would have been called tax farmers.
Any tax placed on a corporation is simply added into their pricing structure and is paid by the final buyer. However, the corporation does not pay the taxes upon the sale of its items but on a quarterly or annual basis. That means that what they collect sits in their bank accounts and draws interest until they give it over to the tax man. The profit on the interest, after taxes, is free money for the corporation. So raising taxes on corporations only cost the public more and enriches them. That is why, despite their considerable political and economic power, corporations rarely protest tax increases in a serious manner.