Economy Minister (Shas) Aryeh Deri is not just continuing to battle to eliminate value added tax (VAT) on basic items, but he wants this to apply to electricity as well.
According to reports, Deri’s office is preparing the plan, which will be submitted to the treasury. The zero VAT plan being prepared would apply to bread, milk, challah, shemenet (sour cream), cheeses (not all), eggs, baby food, and fares for public transportation, water and electricity.
The plan is being prepared in time to include in discussion to approve the next state budget. It was Deri who announced during the election campaign that Shas would not be a part of a coalition that does not accept the zero VAT plan. Deri last week already warned that if his plan is not incorporated in the budget, Shas will not vote in favor of the budget.
(YWN – Israel Desk, Jerusalem)
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2 Responses
I totally agree with Deri on this. Don’t accept the Kahlon / Netanyahu claims of a budget shortfall. It’s simply their line for cutting programs they don’t like. If there’s a problem, let them cut their own budgets.
So he’s noticed that a consumption tax (VAT in Israel, in the USA we use a retail sales tax) on necessities is highly regressive, even if it is a great way to raise revenue. This is an economic issue, not a halachic one (though an argument can be made that such a tax is incompatible with a Torah perspective). In the United States, such taxes exempt necessities, though most European countries have no such exemption.