Agreement to provide former soldiers, first time home buyers with additional tax exemptions is discriminatory and ignores Arab citizens’ severe housing crisisriminatory

On Sunday 12 May 2014, the Israeli media announced that the Ministry of Justice and the Ministry of Finance reached an agreement concerning tax exemptions (VAT) for first time homebuyers. Accordingly, all first time homebuyers would receive an exemption from VAT of 18% on home purchases up to 600,000 shekels and married couples who served in the Israeli military would receive an additional tax exemption for on first home purchases up to NIS 1.6 million  shekels. The media also noted that this new agreement would soon be presented to the government for approval.

In response, Adalah stated, "using military service as a standard for more distribution of public resources through tax exemptions is a discriminatory procedure that has been disapproved by prior prior Supreme Court decisions." (Please see Adalah's case 'discriminatory State Financial Support to Former Soldiers for Home Morgages). Further Adalah noted: "the way in which the government is offering the tax exemption as a bonus and as an act of generosity is illusive, as it ignores that what it is giving is an urgent need and not a luxury. Tax exemptions offer a solution to the housing crisis, which resulted from land confiscation policies and discriminatory policies in planning, and from the state’s restrictions on residential building spaces and its prevention of issuing building permits in most Arab towns." 

Adalah emphasized that, “The ministries’ decision is discriminatory, as it explicitly recognizes the citizens’ severe suffering due to the housing crisis, yet it predominantly favors only Jewish citizens and leaves Arab citizens to continue with their problems."

Adalah Attorney Suhad Bishara pointed that there is no "logical relationship between tax exemption and military service. In addition, there is no difference between Arab married couples who are looking for housing solutions and Jewish married couples. Rather, young Arab married couples in most cases are in worse economic conditions from young Jewish married couples, and therefore tax exemptions should be given fairly to everyone."

Haaretz Editorial 'Israeli Arabs and others need an exemption from discrimination' 14 May 2014 

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