At the same time, the lower limit for fourth bracket payers drops from NIS 21,800 to NIS 20,000 a month. Israelis earning over NIS 20,000 monthly (about $60,000 annually) pay one-third of their income in taxes. Others earning multiples more find clever ways to pay less.
With high food, housing, medical and other expenses, ordinary households struggle to get by. Street protests express rage. Instead of help, policy measures enacted make things harder. Higher taxes alone strain family budgets.
Across-the-board 5% cuts in most ministries are affected. New priorities were claimed. They include halting cross-border migration, combatting tax evasion, upgrading firefighting capability, and improving civil defense preparedness.
Israel calls it the Home Front Command. In America, it's Homeland Security. Others call it the national Gestapo. How it operates explains why. Israel replicates its harshness. Perhaps tougher tactics are planned.
After passage, Netanyahu claimed:
"We have approved steps to prevent us from entering into a huge deficit in an attempt to protect the Israeli economy and the jobs of Israeli citizens."
"These steps are responsible for protecting the Israeli economy from the global economic crisis."
Knesset members were called back from summer recess to address two government-sponsored bills. One involved tax hikes and budget cuts discussed above.
The other gives transnational corporations huge tax breaks. Earlier rules meant keeping profits in Israel. Now they can do what they wish after paying minimal taxes.