Drop import tax on tuna, says panel
The Chamber of Commerce supports cutting import duties
Import duties on canned tuna should be gradually cut over four years, the panel examining the food industry is expected to decide. Currently, canned tuna is subject to 40% tax. But imports of frozen tuna, which is exempt from duties, have been increasing for years. The tuna is then canned in Israel.
The Chamber of Commerce supports cutting import duties. The government imposed the high duties in order to protect local canning factories, and consumers are paying that tax for the benefit of five factories, it said.
"Lowering import duties on canned tuna will lower prices to consumers by NIS 1.50 to NIS 2," said a Chamber of Commerce source. "It will force the local factories to become more efficient and to expand existing production lines. When they're protected from competition, they have no incentive to be efficient and consumers pay the price."
The tuna canners are expected to present a report they commissioned from consulting company David Boaz stating that doing away with the import tax will cost the economy NIS 135 million a year.
The report warns that the factories will collapse, state revenues will take a hit, people will lose their jobs and the societal fabric in communities near factories will be damaged.
The five local tuna canners are all in the periphery, and employ an estimated 500 employees, most of whom are of low socio-economic standing.
If import duties are dropped, the factories will all close, and the resulting unemployment will cost the state NIS 20 million, on top of the NIS 15 million in lost state revenue, argues the report.