"Our objective is not to deal with the rising or falling price of this or that cheese, but to examine whether there has been a market failure, or if there are things that need correcting in the market as a whole," said Minister of Finance Yuval Steinitz told the heads of retailers and dairy companies today whom he met to discuss the cottage cheese crisis.
Steinitz added, "We have already conducted a number of checks, and Prime Minister Benjamin Netanyahu is involved in the matter. There is no division of responsibility here. The responsibility for dealing with the matter falls on the government."
Sources at the meeting told "Globes" that the atmosphere was good, but that no solutions were presented for dealing with food rising prices. Steinitz said, however, that VAT on food products in Israel was higher than in Europe.
One source said, "The heads of the dairies said that their margins were insufficient, and that VAT on food products in Europe was 5%, compared with 16% in Israel." Another source said that the retailers' representatives complained that they were required to mark prices on every product, which involves high costs and the employment of hundreds of people.
The Ministry of Finance is contemplating possible measures, including reimposing price controls on products, imports, and quotas. Sources inform ''Globes'' that, next week, a ministry team will submit a preliminary report to Steinitz.
Published by Globes [online], Israel business news - www.globes-online.com - on June 23, 2011
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