For the first time since taking office, Finance Minister Bezalel Smotrich has instructed Treasury officials to reverse tax increases on single-use plastic products and sweetened drinks introduced by his predecessor, Avigdor Liebermann.
At a meeting for his first job as finance minister, Smotrich urged authorities to “prepare an order as soon as possible in the next few days to cancel the single-use plastic product tax and sugary drink tax imposed by the government going forward.” , the Treasury Department said in a statement.
“I have great confidence in them and their staff,” Smotrich told officials at the start of the meeting.
According to multiple Hebrew media reports, “There will be an open and deep dialogue between us, and professional decisions will be made to boost the Israeli economy for the benefit of all Israeli citizens. okay,” he said.
Ultra-Orthodox Israelis perceived tax increases aimed at preventing harm to health and the environment as targeting them specifically because they depended on such products.
Haredi has repeatedly criticized the tax and praised Smotrich’s move after calling for the government to cancel the tax in coalition talks.
According to the Israeli Tax Authority, the elimination of the tax will cost the State Treasury 1.2 billion NIS ($340 million) in annual tax revenue.
New Finance Minister Bezalel Smotrich (left) shakes hands with outgoing Minister Avigdor Liebermann during a handover ceremony at the Ministry of Finance in Jerusalem on January 1, 2023. (Yonatan Sindel/FLASH90)
United Torah Judaism MK Moshe Gafni applauded the decision to overturn the ‘Liverman tax’.
“This is one of our promises to implement as soon as the government is launched, and I am very happy about it,” he said.
UTJ MK Uri Maklev said that once the tax is revoked, “we will work on public campaigns and education to protect the environment and consume healthy drinks.”
But the decision was denounced by former environment minister Tamar Zandberg, who accused the government of “allowing petty politics to destroy the environment and health.”
“Instead of moving forward, this decision sets us back many light years,” Zandberg said, adding that the decision “will only contribute to pollution and disease.”
The Israel Environmental Defense Coalition also condemned the decision, saying it “harms public health and is also forcing the State of Israel to become one big landfill.”
Outgoing ministers held a handover ceremony on Sunday with Prime Minister Benjamin Netanyahu’s newly inaugurated government successor.
Finance Minister Avigdor Lieberman (right) speaks with new Finance Minister Bezalel Smotrich during the handover ceremony at the Ministry of Finance in Jerusalem on January 1, 2023 (Yonatan Sindel/FLASH90)
In a meeting with Smotrich, Liberman warned that the Treasury Department’s role is not only to “protect the coffers”, but to generate revenues to create a runway for greater freedom of action in budget decisions.
Lieberman appeared to be referring to a coalition agreement signed by the incoming government that plans to increase welfare payments for ultra-Orthodox, whose employment rates are low.
Smotrich largely continued the free-market policies of his predecessor, promising to “increase competition as much as possible.”
“I don’t know if all our procedures will be popular, but I hope over time they will prove correct,” he said.
Smotrich is following in Liberman’s footsteps as the Israeli economy slows significantly this year and the cost of living rises, led by house and energy prices. The prices of various essential services and products rose at midnight, and the prices of petrol, water, electricity, etc. rose sharply, harassing consumers.
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