Ahead of the opening of the summer session, during which new decrees are expected to be imposed on the Haredi public, the discriminatory criteria for the cancellation of VAT for first-time home buyers were finalized today (Sunday).
The criteria indicate that preference will be given to military veterans or civil and national service personnel as a condition for receiving the benefit.
The decision was made after lengthy discussions between the Finance Minister's office and Attorney General Yehuda Weinstein and his office staff. In the past, the Attorney General opposed approving criteria that do not provide a certain benefit to all segments of the population, while Finance Minister Lapid insisted on his demand to create a clear preference for those who have contributed to the state.
Want more news, videos and stories? Join the Haredim 10 WhatsApp channel >>
Ultimately, a compromise was reached between the parties, according to which an Israeli resident who has served in military, national or civilian service will be entitled to a VAT benefit of 0% for a first apartment worth up to 1.6 million shekels. On the other hand, someone who has not served will be entitled to the benefit for the purchase of a first apartment worth up to 600,000 shekels only.
In addition to these criteria, there are the old criteria: A married couple with at least one child, or a parent in a single-parent family with at least one child in their care, A married couple without children (when one of the spouses is over the age of 35), a single person over the age of 35, a person who is entitled to a general disability pension in accordance with the National Insurance Law or a person with a disability level of at least 75% who is entitled to a work injury pension in accordance with the National Insurance Law or a pension according to the Disabled Persons Law as someone who met the conditions of military/national/civilian service.
The eligible persons will observe the following rules: the rights to the apartment are registered in the names of the spouses, the apartment is the couple's first apartment, and neither spouse has ever owned a residential apartment, and neither spouse has made a transaction to purchase an apartment and canceled it.
The apartment purchased in accordance with the benefits will be required to meet minimum specifications that will be published in the coming days for public comments.
We note that the initiative must be debated and approved by the Knesset plenum, and it is also possible that petitions will be filed against it with the High Court of Justice.
Minister of Housing: In 2013, there were 364 transactions for this amount
Housing Minister Uri Ariel was quick to criticize the initiative: "Data from the Commissioner of the Sales Law (Apartments) at the Ministry of Construction and Housing, to which every contractor selling an apartment is obligated to report sales data, indicates that in 2013 there were only 364 transactions for an amount less than 600,000 shekels (including VAT), and in 2012 there were only 212 such transactions. It should be noted that this number also includes transactions for the sale of parts of apartments and apartments within the framework of the 'Price for the Tenant', which according to the Housing Cabinet decision will not be included in the VAT benefits.".
On the one hand, the minister clarified that he supports "giving preference to those serving in military and national service," but, on the other hand, "opposes the complete exclusion of population groups from the zero-rate VAT program, in accordance with the Attorney General's principled position on this issue.".
Based on his knowledge of the apartment market and the needs of the various population groups in Israeli society, the Minister believes that the price of an apartment with a zero VAT benefit for those who do not serve in the military should be set at 950,000 NIS.
The chairman of the Finance Committee also praised the initiative, on the one hand, but criticized it, on the other. Slominsky praised Lapid's initiative to favor military veterans, but noted that he viewed positively the acceptance of the recommendation of the Minister of Housing and the Legal Advisor that those who did not serve in the military should also be included in this process. On the other hand, he added, and since there are almost no apartments on the market worth 600,000 NIS including VAT, "I agree with the Housing Minister's proposal and call on the Finance Minister to raise the benefit threshold to 950,000 NIS for those who have not served.".
MK Meir Porush of United Torah Judaism criticized the initiative, saying: "Lapid is using the army as a hatchet to harm the Haredim, while he does not hesitate to dig with both hands into the core of the security of the State of Israel and is mercilessly cutting the defense budget.".
MK Yaakov Asher of Delg HaTorah also sharply criticized the initiative. According to him, "The criteria published by the Ministry of Finance would not embarrass any anti-Semitic government. The Haredim will buy apartments for up to 600,000 NIS, perhaps on Mars! With the Attorney General's 'kosher', probably for the same reason he sent us to repeat elections in Beit Shemesh." .
