Do You Own 3 Apartments in Israel? You Might Have to Pay

Moshe Kachlon, the Minister of Finance, ran for office with a promise to look out for the weaker sectors of society. That promise is now being put to the test. In the upcoming discussions over the national budget, Kachlon’s constituents will watch to see whether the budget will bring good news for the disadvantaged.

As of now, Kachlon does not seem to be favored in the polls. The voters have already been disappointed by his performance in addressing Israel’s housing issues, and if the new budget does not show a significant socialist influence, it will likely lead to an even greater drop in his popularity. Last year, Kachlon announced from the Knesset podium that the state budget would be the most beneficial in Israel’s history for the poor. The question now is whether that still holds true.

The discussions will begin over the course of the next two weeks. The Knesset will convene for a special debate despite the summer recess, and the state budget will be approved following its first reading. The budget will then be sent to the Knesset Finance Committee for more detailed discussion. Ostensibly, the government should have no problem getting the budget approved, since it has a majority both in the plenum and on all the committees. Nevertheless, there is always the possibility that a few Knesset members of the coalition – and all it takes is one or two to create a problem – will decide that their consciences do not allow them to vote with the government on some issue. If that happens, then there will certainly be fireworks; it has happened in the past as well. It is already clear that the Knesset will not accept the move to make sweeping budget cuts to all the government ministries. Some of those proposed cuts would cause direct harm to the elderly or the infirm.

In the meantime, Kachlon has announced one new tax that he intends to enact in order to generate funds to benefit the weaker sectors: a tax on owners of three or more apartments. This has some bearing on the chareidi community, where a trend has developed for families to use their investment money to purchase additional apartments in cities on the periphery of the country. For the price of half an apartment in Yerushalayim or Bnei Brak, a person can purchase two apartments in Kiryat Gat or Dimona. The apartments can be rented to students or to young chiloni couples, and the investor can thus regain his money after a few years. Aside from that, he will own a piece of property that can be sold at a profit when the time is right. These property owners are not the targets of the finance minister’s proposed legislation, which is actually aimed at real estate moguls. Nevertheless, Moshe Gafni, the head of the Knesset Finance Committee, has already announced that his committee will never allow the proposed tax to pass. Naturally, Gafni’s interest is in protecting yungeleit.

This tax may also affect families who live in America and who have purchased several apartments in Israel. Moreover, it was recently reported that there are quite a number of Knesset members who will personally suffer from the tax, since they themselves own a number of apartments. Will they vote against the tax because of their personal interests? Perhaps, since the law does not prohibit them from doing so.

{Matzav.com Israel News Bureau}