Israel to cut VAT
Possible VAT cut in Israel
The Prime Minister of Israel, Benjamin Netanyahu has recently announced plans to reduce the current rate of VAT from 18% to 17% to help promote economic growth, following a higher than expected tax collection in recent months. Speaking earlier this month, Prime Minister Netanyahu is quoted as saying “An economy burdened by high taxes doesn’t grow, so in order to encourage growth I have decided, with Finance Minister Kahlon, to cut taxes.”
The expected implementation date is the 1st of October 2015. However the same VAT cut was promised in 2014 and it failed to be implemented along with promises earlier this year to reduce the VAT on food.
Israel have been suffering from a flat economy in recent years and are looking at plans to bolster it and after serval discussions earlier this month this latest VAT cut proposal has now been given the green light. In order to silence those who have questioned how viable this cut is, the Prime Minister has also promised that if the cuts fail then the whole issue will be revisited and taxes may be raised again.