Produce growers, sellers steamed over VAT proposal on fruits, vegetables

Some vendors and protesters dump crates of tomatoes and other produce onto the street at Mahaneh Yehuda Market.

June 29, 2009 22:59
2 minute read.
Produce growers, sellers steamed over VAT proposal on fruits, vegetables

mahaneh yehuda protest 248.88. (photo credit: AP)


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Growers, sellers and buyers gathered at Jerusalem's Mahaneh Yehuda Market Monday afternoon to protest against the government's proposal to put a value-added tax on fruits and vegetables. The measure is to be discussed by the Knesset Finance Committee on Tuesday. Participants said they felt betrayed by Prime Minister Binyamin Netanyahu and MKs from the Likud and Shas who have supported the proposal, which assess VAT on locally grown produce. Wearing T-shirts and holding signs with the slogans "There is nothing tasty about vegetables with VAT," and "The VAT on vegetables is not right nor smart," the protesters urged the Knesset not to implement a tax that will "crush every Israeli who buys, eats or sells fruits and vegetables." "This tax will hit people in the pocketbook the most and will stop poor families from buying vegetables. And vegetables are a source of health," said Sapir Roberts, a Jerusalem resident who attended the rally. If the proposal is passed, the tax will put a burden on vegetable growers to collect the tax, Roberts said. Many growers and sellers also see the government's proposal as a regressive tax, since many low-income and underprivileged families buy their produce in markets that sell goods at unregulated, low prices. "The tax would be an evil change that will hurt the people who are already struggling the most," said Gadi Aram, who works for the group that organized the rally, AMI - the nationwide social activist movement whose name is a Hebrew acronym meaning Future of the State of Israel. "We are urging the government to go back on the proposal to place a tax on fruits and vegetables because it will hurt the underprivileged sectors, the people who will be hurt significantly if the tax is passed." Though fruits and vegetables have always been exempt from taxation, the Treasury announced earlier this month that it intends to impose 16.5 percent VAT on produce, saying it would add NIS 1.8 billion to the government's coffers, according to the Finance Ministry. "The tax will make it more expensive for growers to sell their products because the economic situation is bad and exports are poor," said Ruti Fogats, spokeswoman for an Israeli vegetable growers' organization. Local growers live in border areas and small towns where the only source of income originates from the sale of agricultural produce, she said. The tax would significantly affect shouks throughout the country, including Mahaneh Yehuda and Tel Aviv's Carmel Market, Fogats said. If the Knesset implements the proposal, the poor would suffer the most because the prices of basic foods will rise, she said, calling it a "disaster." Leon Sona, a vendor at the Mahaneh Yehuda Market, said the tax would affect how he will be able to sell his fruits. Pointing to fresh plums on his stall, Sona said the tax would make it difficult for him to sell the plums for their true value and provide a challenge when calculating the tax. The Agriculture Ministry does not support the proposal, said Hila Be'eri, the ministry's assistant spokeswoman. Some vendors and protesters dumped crates of tomatoes and other produce onto the street. They concluded their protest with the singing of "Hatikva." The social activists and produce sellers also announced that they were going to the Knesset on Tuesday to urge MKs not to implement the VAT.

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