Sep 8, 2020

Proposed Law: Vat Free Status for cities under lockdown

MK Eliyahu Baruchi (UTJ) has proposed an interesting law related to lockdowns and closures.

According to baruchi's proposal any city put in lockdown should be granted VAT-free status for the duration of the lockdown. Eilat already has VAT-free status, and this would grant any other city placed under lockdown that same status.

Baruchi justifies his proposal by pointing to the economic damage caused by lockdowns. The government financial assistance given has been a pittance compared to the damage done to people's businesses and livelihoods. Granting the affected area vat-free status would encourage business within the restricted zone, it would help the struggling people with cheaper purchases and would help the businesses attract business during the difficult time.

According to Kikar, Baruchi actually proposed this when a full closure was being proposed on "red cities", but now that only a night closure is being imposed says that his law would not apply to night closures as the economic affect is much less, though he is looking into other options to properly give assistance for this as well.

Personally I dont see why it cannot apply for a night closure as well, even if it is less necessary. It does not have to be exactly even. They are creating a heavy burden on the residents of numerous cities for a period of time - a week, two weeks, a month, whatever - so they can also give a benefit for that period of time to placate the masses somewhat. 

if the cities were granted VAT-free status, I am pretty sure that instead of all this opposition to lockdowns more cities would be begging for lockdowns to bring prices down by 17% for a period of time! It might even effect more compliance.

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1 comment:

  1. I dont see how it could be feasible technically.

    This is pure populism.


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