Israel may lower taxes on food
2023.01.15 09:03
Israel may lower taxes on food
By Ray Johnson
Budrigannews.com – On Sunday, the Israel Manufacturers’ Association proposed a slew of other measures to address the high cost of living in Israel and boost the country’s economic competitiveness.
The economic plan presented by the Association to Israel’s prime minister and finance and economy ministers called for lowering the value added tax (VAT) on food from 17% to 9%, which is the average for OECD countries.
Along with vocational training to increase labor productivity, the group, which represents approximately 1,500 businesses and 400,000 employees, proposed increasing state funding for research and development to 0.5 percent of business output, reducing excess regulation by 25 percent, and other measures.
According to the Association, the measures would enable Israel’s manufacturing sector to maintain its global competitiveness, invest in workforce development and innovation, and drive sustainable growth.
According to Ron Tomer, president of the association, the economy had begun to slow, employment levels were dropping, and production costs were rising. However, he noted that Israel’s inflation and economic activity were higher than those of its rivals in international trade.
He stated, “We must take advantage of these relative advantages to lead the Israeli economy to growth earlier this year.” This necessitates a well-organized social and economic strategy from the government.”
The Israeli economy is expected to expand by 2.8% in 2023, up from about 6% in 2022. It is anticipated that inflation will slow to 3% from over 5%.
Incoming economy minister Nir Barkat has declared a “war on regulation,” which he referred to as “a cancer on the economy,” in order to alleviate the “unbearable load” on Israeli businesses. The new Israeli government is currently in the process of drafting a budget for 2023, which must be fully approved by lawmakers by May.
Israel’s Prime Minister Benjamin Netanyahu and Finance Minister Bezalel Smotrich announced preliminary measures to reduce inflation last week, announcing that recent increases in property taxes, water, and energy costs would be canceled or reduced.
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