Negative income tax plan unveiled

Finance minister introduces plans for pensions, tax on car leasing.

By JPOST.COM STAFF
hirchson 298.88 (photo credit: Ariel Jerozolimski [file])
hirchson 298.88
(photo credit: Ariel Jerozolimski [file])
Finance Minister Avraham Hirchson presented on Monday his plan for reform of car-usage taxes and a proposal to implement a negative income tax system, as well as a plan to guarantee pensions for all employees. Hirchson, at the end of last year, appointed a committee to examine the value of company cars leased by employees in response to a proposal by Finance Ministry tax experts to raise the assessed value of leased cars. By doing so, tax authorities will be able to collect a higher taxes from employees who take advantage of this popular company perk. A negative income tax is expected to increase available income for citizens and boost participation in the workforce. "I chose negative income tax based on the understanding that the war on poverty will succeed only when participation in the workforce is significantly increased," Hirchson said at the Herzliya Conference last week. "This is not a simple step; its budgetary cost is high; it obligates tens, even hundreds, of thousands of citizens, but I believe it is just and correct."