After criticism of the tax increase: Finance Minister Bezalel Smotrich announced today that the tax on electric vehicles and Peleg-In vehicles will remain the same until the end of January 2024. The decision refers to vehicles on their way to Israel that were supposed to arrive at the port by the end of 2023 and is delayed due to the Houthi threat and the security risk in the Red Sea.
Titi Ainaw at the launch of an electric vehicle (archive) // Photo: Moshe Ben-Simhon
The order comes after the route of many ships was delayed due to the war and the threat to shipping lanes in the Red Sea, ship lines were changed to avoid security risks along the way. As a result, the ships were required to circumnavigate the African continent in order to reach a port in Israel via the Mediterranean. The change of route has extended travel time and ships that were supposed to arrive before the end of 2023 will arrive late. The order was issued to address these cases.
According to the Tax Authority's outline, the purchase tax on electric vehicles will increase from 1 percent to 20 percent starting January 35.
Eitan Parnas, CEO of the Association of Green Energy Companies, told Israel Hayom that the plan will distance electric vehicles from many populations. "If the tax goes up, an injustice will be done to entire populations that will not be able to purchase an electric vehicle, and they will be excluded from progress."
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