A last attempt to curb the price increase:
the finance committee demands that the tax authority postpone for a year the planned tax increase on electric vehicles, which is expected to lead to a significant increase in the price of the industry.
During a special discussion on the subject held by the committee today (Monday), Chairman Gafni explained that "This is a wrong and unjust decision that comes to us at the beginning of a new government, without being able to organize and study it properly. I ask you to postpone the tax increase for 2024 and to return to us with answers within three days".
"To wait with the tax increase until 2024", Chairman of the Finance Committee, MK Moshe Gafni (archive), photo: Dodi Vaaknin
Recall that the tax benefit on electric vehicles ended at the end of last month.
As a result, from the beginning of January the tax on the purchase of these vehicles was doubled: instead of 10% today, it will now be 20%, and in 2024 it will be 35%.
In addition, the tax benefit was for a maximum amount of 75,000 shekels, and now it will drop to 60,000 shekels - meaning an increase of up to 15,000 shekels in the price of electric vehicles.
The tax increase is an automatic implementation of a tax outline that was drawn up a few years ago, even before Lieberman was finance minister.
The gradual outline was accepted back in 2019 and was originally intended to examine the entry of electric vehicles into Israel.
Since then, these vehicles have become very popular in the Israeli market, so the treasury's assumption was that there was no longer a need for the tax benefit.
Following the war in Ukraine, battery prices did not drop as expected (for illustration), photo: Raz Anidjar
It should be noted that at the time the outline was determined, a decrease in battery prices was expected in 2022-2023.
In practice, due to the war in Ukraine and the commodity crisis, the prices of batteries actually increased, so it seems that there is no economic sense in making the electric vehicle more expensive.
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