Israeli Public Housing Tenants Charged Excessive Municipal Tax

City taxes hiked up to pay for urban renewal projects after Interior Ministry fails to implement discounts passed by lawmakers two years ago

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Guy Sinai in his Tel Aviv apartment, September 2018.
Guy Sinai in his Tel Aviv apartment, September 2018.Credit: Dudu Bachar

Israeli officials have yet to impose requisite regulations to implement a law passed two years ago that bars municipalities from raising local taxes for improvements made in public housing projects.

As a result, housing project residents are complaining of higher municipal tax bills that they cannot afford.

Guy Sinai, 42, of Tel Aviv, has seen his municipal taxes, “arnona” in Hebrew, increase fourfold since improvements were made to his apartment. Sinai lives with his disabled mother in a home they have had since he was child.

Three years ago, his building was refurbished nearly doubling the size of his apartment. As a result his municipal tax bill has risen to 850 shekels ($237) a month.

A building in Jerusalem in urban renewal renovations, July 2018.Credit: Olivier Fitoussi

”I’m in a difficult situation that I have never faced in my life. These municipal taxes are breaking me,” Sinai said.

About 2,400 families live in public housing projects undergoing urban renewal improvements, Housing Ministry data show. A law passed in August 2016 bars municipal governments from increasing these residents' taxes for at least five years.

But the law gave the Interior Ministry nine months to issue the regulations necessary to implement the tax discount. These regulations have still not been issued, and housing project residents are being forced to pay the price.

The ministry has informed the non-profit Yedid Association for Community Empowerment that the approval process for the regulations is nearly complete. Yedid said it has received a number of complaints from public housing residents having trouble paying their higher municipal tax bills.

The Government Urban Renewal Authority said in a statement to Haaretz it has done what it could to advance the approval of these regulations and that it had “finally received a draft of regulations” last month, to which is has issued comments. “As far as the authority knows, no objections have been raised to issuing the regulations,” the statement said.

Public housing in Kiryat Shmona, a working class town near the Lebanese border, May 2018. Credit: Merav Moran