Coalition infighting continues over settlement tax benefits

According to MK Gafni, adding the West Bank would cost NIS 600m. out of the amount allotted for the benefits, leaving less for periphery towns.

October 22, 2015 14:41
4 minute read.
Givat Ze'ev

The West Bank Settlement of Givat Ze'ev. (photo credit: REUTERS)


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Coalition MKs in the Knesset Finance Committee sparred over whether to include the West Bank among regions that receive tax breaks, at the panel meeting on Thursday.

The Finance Committee was supposed to hold a vote on 5- to 6-percent tax breaks for the periphery on Wednesday, but Bayit Yehudi demanded that 60 West Bank towns classified as being under serious security threat be included, warning that if not, the party will not vote for the tax breaks.

Committee chairman Moshe Gafni (United Torah Judaism) said there is not enough money in the budget to add another region to the outline, and postponed the vote at the demand of Tourism Minister Yariv Levin, the liaison minister to the Knesset.

Gafni said on Thursday that he took it upon himself to help the periphery and called on other MKs to do the same.

“Many previous coalitions avoided taking care of this issue, and even the prime minister and finance minister told me that if I will deal with it, it will get complicated.

I took it on and succeeded, together with the committee members, to reach an outline that will help as many towns as possible,” he recounted.

Gafni’s outline, drafted with Finance Minister Moshe Kahlon’s cooperation, would increase the amount of towns eligible for the tax break from 192 to 407, with the cost rising from NIS 850 million to NIS 1.2 billion. According to Gafni, adding the West Bank would cost NIS 600m. out of the amount allotted for the benefits, leaving less for periphery towns.

MK Bezalel Smotrich (Bayit Yehudi) pointed out that the West Bank meets the socioeconomic and geographic criteria set by the new outline, and said that the Prime Minister’s Office and Finance Ministry agreed in advance to include tens of millions for the West Bank out of the total NIS 1.2b.

Gafni claimed Smotrich demanded to add the West Bank to the tax break map only two hours before the committee meeting, after the former had been working on the matter for weeks.

“This demand ruined the whole process and will hurt all of the towns,” Gafni added. “Bayit Yehudi did not act [in past years] to include towns in Judea and Samaria in the tax breaks. Now, they bring up the demand that will make the entire outline fail and leave towns in the periphery in a difficult socioeconomic situation, and prevent them from making progress and attracting stronger populations.”

MK Orly Levy-Abecassis (Yisrael Beytenu), who lives in Kibbutz Mesilot near Beit She’an, where she grew up, slammed Smotrich, saying, “You have chutzpah and are harming the weakest populations in Israeli society, those who live in the weakest, most distant places, who need to deal with great difficulties since the establishment of the state.”

MK Erel Margalit (Zionist Union) wondered why Smotrich did not demand to add Jerusalem as well, and said it was wrong for him to make demands at the last minute when the whole committee had worked on the new outline for weeks.

Smotrich responded that he and Bayit Yehudi want periphery towns to receive the full tax benefits they deserve.

“All I said is that there are many towns, with hundreds of thousands of citizens from every population group, including haredim, that deal with a very difficult security situation every day, and the country needs to do everything it can to help them. It doesn’t have to be instead of the periphery; it should be at the same time,” he said.

Deputy Construction Minister Jackie Levy, former mayor of Beit She’an and Levy-Abecassis’s brother, accused Smotrich of dealing in “cheap populism” and called him “dangerous.”

“He is endangering periphery towns because of personal interests and creating antagonism between Negev and Galilee towns and settlements, and trying to create an impression that tax breaks for periphery towns is instead of funding for settlements, which is a total lie,” Levy said.

According to Levy, Bayit Yehudi should help the West Bank through government decisions and not tax breaks for the periphery.

On Wednesday night, Smotrich said, “The Left’s attempt to make it a matter of settlements in Judea and Samaria versus the periphery is a foolish, cynical and demagogic attempt they have made before and is meant to delegitimize the settlements and turn them into the enemy of the people.”

Smotrich added that he is seeking to make the map of tax breaks “egalitarian and just, in which everyone will enjoy [benefits] without differences of political opinion.

“The people harming the periphery are the Left, which was prepared to torpedo the whole plan, because it was most important to them that the settlements not be included, God forbid,” he said.

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