Business in Brief: June 30

Palestinian construction workers okayed; Tax revenues on cars higher than Europe; Big drop in home prices not expected .

June 29, 2011 23:11
3 minute read.
Infrastructure upgrade in Jerusalem

Jerusalem construction 521. (photo credit: Marc Israel Sellem)


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Palestinian construction workers okayed


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The Population, Migration and Border Crossing Authority has approved 2,000 permits for Palestinian construction workers, five months after the government acceded to contractors’ pressure for more workers. Currently, 16,000 Palestinians work in the industry. In February, the cabinet approved the granting of an addition 4,000 permits for Palestinian construction workers, as part of efforts to increase housing starts and complete projects under construction.

The construction industry suffers from a severe labor shortage, Association of Contractors and Buildings general manager Motti Kidur said Wednesday. Contractors who win Construction and Housing Ministry tenders delay starting projects because they lack the men to build them, he said. The Association of Contractors and Buildings sought 20,000 additional foreign workers and settled on a quota of 8,000 over three years. The construction industry currently employs 5,000 foreign workers.

Gov’t: Raise women’s retirement age to 67


Government representatives on the public committee for raising the retirement age of women on Wednesday recommend raising it to 67, equalizing it with men. The meeting, chaired by Finance Ministry budget director Udi Nissan, broke up when representatives from the Histadrut and Na’amat – Movement of Working Women and Volunteers walked out in protest over the proposal. Finance Minister Yuval Steinitz appointed the committee three months ago.

“By law, women’s retirement age is 62, and it is expected to rise to 64,” the Finance Ministry said. It is therefore unclear if the committee has the authority to raise women’s retirement age beyond 64. Most members of the Knesset Finance Committee oppose raising women’s retirement age to 64.

Tax revenues on cars higher than Europe


The state’s annual tax revenues on motor vehicles, relative to the number of vehicles, is much higher than in Western Europe, according to a study by the Knesset Research Unit. Total annual tax revenues on motor vehicles are 46.6 percent higher in Israel than the average in Europe. Annual revenues from taxation on the fixed-cost component of motor vehicles, mainly purchase tax, are 46.1% higher in Israel than in Europe. Annual tax revenues from taxation on the variable-cost component, mainly the fuel excise, are 47% higher.

The study found that the level of Israel’s fuel excise is similar to the levels in Europe. However, Israel has a substantially higher mileage than the average in Europe, mainly because of heavy use of company cars on which employers pay the cost of fuel and the driver’s marginal cost is zero, and because of the lack of a developed public transportation network in Israel. According to the study, state revenues from taxation of motor vehicles in Israel were more than NIS 30 billion in 2010.

Big drop in home prices not expected


Ninety-eight of the 100 assessors who attended a Discount Mortgage Bank conference on Tuesday do not expect a substantial drop in home prices over the next 12 months, and 36 expect prices to rise. Sixty-eight of the assessors predict that prices for luxury homes will fall over the next 12 months, a quarter of whom expect prices to fall sharply. Seventy of the assessors predict that home sales will fall over the next 12 months, while 18 expect an increase. Ninety-five of the assessors expect a drop in purchases of apartments for investment purposes

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