Labor Party MK Avraham Shochat has reason to be happy. He was the first to suggest taxing the Tel Aviv Stock Exchange, back in 1994, during his first term as finance minister, but failed. In his second term, he set up the Ben-Bassat committee, which recommended taxes on the financial markets in exchange for lowering income taxes on wages, but he failed again.

One of the key figures who twice fought tooth and nail against Shochat's efforts to tax the financial markets and lower taxes on wages was Silvan Shalom, then an ambitious Likud MK, now finance minister. Irony of irony, he's now gong to propose taxing the bourse.

Avraham Ben-Bassat, the former Finance Ministry director general, can also be happy today. The reforms being proposed by Yair Rabinowitz are basically the same as those Ben-Bassat proposed, albeit in lower dosages. Rabinowitz learned the lessons of Ben-Bassat - and Shochat. Rabinowitz is not proposing an inheritance tax, nor taxing the supplementary education funds, nor dropping the half-credit for working wives or tax abatements for shift workers at night. Those were the key issues that prompted opposition to the reforms by those who could see their benefits being stripped.

It's a smaller reform, because the tax it imposes on the markets is only about half what Ben-Bassat proposed. And when all the other elements of the plan are taken into account, only about half the revenues Ben-Bassat was counting on from his bourse tax plan will come in from the Rabinowitz plan, which means that the income tax reductions for wage earners will also only be about half what Ben-Bassat proposed.

It's clear there will be opposition to the plan by all those who don't pay any taxes at all, and therefore won't benefit from the plan. That's about 40 percent of the households in Israel, 700,000 altogether. And since the plan will benefit most those who earn between NIS 10,000 to NIS 35,000 a month, those who earn less than NIS 10,000 will also oppose it, because they'll feel shortchanged.

But the entire purpose of the reform is to straighten out the backs of the middle class and the upper-middle class, which carries an absurdly heavy tax burden that has lately been causing emigration, and preventing entrepreneurship, investment and development. The reform has a good chance to pass the government and Knesset, not least because nobody wants to lose their seats in government or the parliament over taxes.