(photo credit: Thinkstock/Imagebank)
The Israel Tax Authority and police netted NIS 21 million in unpaid taxes in a
joint two-day sting operation targeting businesses in Tel Aviv, Ramat Gan and
Bnei Brak this week.
“Evaders Pay,” the name the Tax Authority has given
to its 2012 campaign against tax evasion, includes the participation of tax
offices throughout the country, supported by tax collection, bookkeeping and
This week’s operation was conducted by two
teams: one concentrated on income-tax violations in the Ramat Gan business
district, Tel Aviv’s Hatikva market and Bnei Brak; the other focused on
value-added tax violations in South Tel Aviv and Jaffa.
The income tax
team found that 15 percent of businesses did not record revenues, while another
15% made fundamental bookkeeping errors. Restaurants in the Bnei Brak area were
the biggest culprits, with 28% not able to produce records of revenues and 18%
found to have made errors.
Officials also arrested the head of a catering
company servicing the Bnei Brak ultra-Orthodox community, who they suspect of
concealing millions of shekels in revenues and of not reporting either his own
or the company’s income. The man later admitted to recording fictitious 50%
discounts in his books, even though he had charged his clients the full amount
for the services.
The team investigating VAT-related violations reported
that 62% of businesses had concealed various transactions.
sector was the most serious offender, with 92% suspected of having made
bookkeeping errors A human-resources company was suspected of failure to pay up
to NIS 4m. in taxes. A hotel in South Tel Aviv that allows customers to book
rooms by the hour (a form of accommodation usually used for conducting sexual
activities) was also suspected of concealing a large amount of transactions from
Inspectors highlighted difficulties in two particular cases:
the owner of a furniture store in Jaffa’s flea market fled when he saw them
approaching; and the owner of a hairdressing salon in the Hatikva neighborhood
threw projectiles at officials but cooperated after being restrained by police.