Even as the zero VAT bills winds its way through the Knesset Finance Committee, a major change in the law's implementation has already occurred. Under the original bill, the Ministry of Housing and Construction would issue eligibility rights documents, but sources inform ''Globes'' that this power will go to the Israel Tax Authority. After discussions with of the relevant parties, it was decided to set up a special agency, chaired by a Tax Authority official, to manage the work of the Government Assessor and the Ministry of Housing. The sources added that Tax Authority deputy director general for land taxes Meir Asulin will head the agency.
This is an important crossroads in the implementation of the zero VAT plan, because eligible people who meet the criteria will have to apply for a rights document. The Ministry of Housing will examine the applications, and if the applicant meets the criteria, the rights documents will be issued within 30 days.
Handing over the full implementation of the zero VAT plan to the Tax Authority is important in another way: implementation will be wholly under the Ministry of Finance's control, instead of being shared with other ministries. The possibility of eligible people obtaining the rights documents when applying for a mortgage at the banks is also being considered.
The Ministry of Finance and the Ministry of Housing have confirmed the report. The Ministry of Housing says that it will keep the right to buy apartments under the target price plan. Ministry of Finance officials said that the new agency and transferring the authority to the Tax Authority was at the request of Minister of Finance Yair Lapid, so that the zero VAT bill could move forward and operate optimally.
Ministry of Housing officials said today that the Tax Authority will have to set up an entire system, which already exists at the Ministry of Housing, to carry out the task, implying that this is liable to affect the tax break's timetable.
Published by Globes [online], Israel business news - www.globes-online.com - on May 27, 2014
© Copyright of Globes Publisher Itonut (1983) Ltd. 2014