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Jul 8, 2015
Quote of the Day
We started a process of lessening demand by increasing the purchase tax. We were criticized for it, but I am at peace with our process. It cannot be that someone with means can buy 4 apartments while young couples are distanced from being able to buy apartments. I said to the investors, who says you need to diminish the apartments available for young couples? Everybody has to take others into account.. some people have 2, 3 or 4 or even more apartments. One cannot consume the entire world. We have to take into consideration our children so we made the decision to chase investors away from the market.
-- Finance Minister Moshe Kahlon
sounds strange for a Finance Minister to make a decision, and be proud of it, to chase away investors.
-- Finance Minister Moshe Kahlon
sounds strange for a Finance Minister to make a decision, and be proud of it, to chase away investors.
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It is a stupid analysis fraught with little insight about economics and human nature. I know people who rent and are being told Kachlon's new purchase tax (and any others the government applies) will be passed along in rent increases. Kachlon's solutions are a throwback to yesterday's socialistic ideologies that collapsed in Russia and Israel and will further retard Israel's economic development--already facing declining numbers.
ReplyDeleteAll taxes are passed along to consumers, if they aren't a tax on the consumer himself. That doesn't mean we should eliminate all taxes except for those imposed on individuals.
DeleteYes, the famous paradigm that the purchase tax will be passed on. So, Israel has a few hundred thousand homes for rent. Each year, a few thousand around the country are bought as second and third properties and they will have the increased tax. Because some Chaim Smekel has to pay increased tax, he's going to pass it on to the renter?
DeleteCan you give me a break? A few new owners in the neighbourhood are not going to set the market price.
The advantage of this new law is to merely milk these investors because they are going to keep buying in any case without any alternative area to invest in.