A Tel Aviv court on Sunday ruled that childcare expenses are indeed tax deductible for working families.

In a landmark decision, the Tel Aviv District Court ruled expenses for daycare and other costs dealing directly with the needs of children are indeed tax deductible, instructing tax authorities to recognize the expenses as such.

Internal Revenue Service officials in Israel have already stated an appeal will be filed with the High Court of Justice. Until the High Court rules, the lower court’s decision will most likely not be implemented.

Tax authorities’ officials are vehemently opposed to the move, which they estimate will cost the state over NIS 1.5 billion in annual income. Treasury officials have already announced that alternatively, perhaps they will design a subsidy for daycare centers towards reducing daycare costs.

The court’s decision is intended to provide relief for families in which both parents work and have an ability to prove that during the hours children are in daycare they are earning a livelihood.

(Yechiel Spira – YWN Israel)