Israeli Lawmaker Is More Like Houdini’s Harmful Helper

A religious-Zionist legislator wants to stay in power, so he’s helping Finance Minister Yair Lapid push through a tax bill that's mucking up the economy.

Michal Fattal

Habayit Hayehudi MK Nissan Slomiansky doesn’t seem to like Israelis too much. Sometimes it seems he hates us all. He’s also betraying his office as a Knesset member. This can be seen in the way he’s handling the zero-VAT bill.

Slomiansky, chairman of the Knesset Finance Committee, knows full well that the bill to exempt first-time buyers of new apartments is bad for the economy, bad for housing prices and bad for the budget.

He has said this outright: “I don’t like the law …. The law is problematic .… Zero-VAT will increase demand and could raise prices …. The law will cost 3 billion shekels [$840 million] and will cause difficulties considering the need to fund Operation Protective Edge.”

And there’s more: “The law will cause a constitutional problem; it discriminates between various groups, between ultra-Orthodox and Arabs and the rest of the public, between kibbutzim and moshavim and outlying areas.”

In other words, this is a terrible bill that will only cause damage. So why does Slomiansky declare he’ll “lie on the fence” — do everything he can — to push the bill through? After all, he took an oath when he became an MK: “I pledge loyalty to the State of Israel and to faithfully fulfill my duties in the Knesset.” That’s not how you're loyal, that’s how you betray the country.

Slomiansky’s reasoning for pushing this bad bill is that “as a member of the coalition I’m obligated to promote the law that has become the finance minister’s flagship. Not doing so could lead to drastic changes in the coalition.” That is, the current coalition could lose power and an end Slomiansky’s position as chairman of the Finance Committee. That’s more damage than the people of Israel could stomach.

Finance Minister Yair Lapid vehemently claims he hasn’t caved to Slomiansky; he says he hasn’t transferred a penny to the settlers so that Slomiansky would “lie on the fence” for the bill There has been no official deal, just an oral understanding. As Slomiansky puts it, “It’s inconceivable for me to lie on the fence for a law I don’t like.”

Lapid also forgets to say he gave in to Slomiansky on one critical clause: application of the zero-VAT law to large private houses in so-called national priority areas; that is, in the West Bank. A house can be 150 square meters large and a settler family will receive a VAT exemption worth 300,000 shekels ($85,700). Later the family can expand the place by 100 square meters and thus strengthen the settlements and make the chances for peace more remote.

Later, Lapid will ask in amazement mixed with anger, using the catchphrase when he was a journalist : “Where is the money?” He should answer: “Between the settlements of Itamar and Yitzhar. I gave it to them."

The ultra-Orthodox also weren’t born yesterday. United Torah Judaism MKs Moshe Gafni and Yaakov Litzman enthusiastically say they’ll torpedo the zero-VAT bill. But their goal is clear: to raise their price.

So they submitted 2,000 objections to the bill and they’re waiting for Lapid bear a sack of gifts like Santa Claus — for Rosh Hashanah next month. They want gifts  equal to what the settlers are getting, and Lapid will pay and strengthen those who detest him.

The sad part is that the treasury people told Lapid that this is exactly what would happen. They explained that the ultra-Orthodox, the settlers and the attorney general would distort the bill unrecognizably. The team of professors advising Lapid explained to him over and over that the plan was bad for the economy, bad for prices and bad for Lapid personally.

But Lapid hates economists and disparages the treasury people. He believes only in his political adviser, Uri Shani, whose bad advice will bring him down to the depths, along with zero VAT.

Now Lapid is trying to square the circle. In addition to the zero-VAT gift, he’s giving billions to the defense sector without cutting much of the social ministries’ budgets or raising taxes, while trying to keep the deficit at 2.9 percent of gross domestic product as he promised.

That of course is impossible. Even the great Houdini couldn’t pull that one off. But Houdini didn’t have a helper named Slomiansky, with whom everything is possible.