27/1/2013

Question of what is right tax to pay is subjective matter. 0 would be nice, but would not finance running the country.

Passover is over. Bread consumption is back to normal.

Here’s a roundup of Passover-related things.

Monthly reporting for businesses and others The Income Tax Authority announced on April 4 an extension for filing monthly tax returns and making tax payments from this April 15 to April 23. This applies to income-tax installments, payroll withholding tax, other withholding tax and VAT. It also applies to payments made over the Internet or via an accountant or tax adviser on the ‘ Shaam ‘ online system for professionals.

The National Insurance Institute initially announced an extension for filing returns and paying national insurance from April 15 to April 18, but it has just extended it to April 23, the same as the the above tax filing date.

Tax director has a vision A number of readers and clients were alarmed to receive in their mailbox an unusual letter from Tax Authority director Doron Arbeli. It wasn’t a Haggada.

What does it say? It is addressed to taxpayers in Israel and is dated April 2012. It reads as follows : I find it appropriate to turn to you personally to inform you of the vision of the Tax Authority as set forth below and of the new work processes that we are adopting to enhance cooperation with you.

As you know, the Tax Authority is responsible for collecting taxes, which represent about 95 percent of state revenues, which are the main ‘oxygen tube’ of the State of Israel. Correct and efficient collection assures a source of finance for defense, education, health and essential services for you and your children.

The new vision that the Tax Authority has developed includes a number of basic principles relating to providing efficient, quality and decent service, enforcing tax collection, empowering human capital and paying the right tax.

In 2012, we will devote substantial resources to quality and excellence, in particular: recruiting and training hundreds of new employees, new work processes aimed at reducing bureaucracy and removing bottlenecks, conducting polls and deploying new technologies. To improve the service at our offices, we will expand the telephone call center and devise a service pact and an ethical code.

The Tax Authority will continue to make its services accessible to the public on its website, with the aim of providing a user-friendly tool as far as possible.

In addition, the Tax Authority will in the coming months introduce tools on the ‘new media’ that will facilitate direct communication between me and you.

In addition, we intend to expand the use of other smart technologies in our work, which will, on the one hand, reduce friction with normative people, and on the other hand, extend revenue collection and rationalize enforcement against tax evaders, since tax evasion is a criminal offense and a social crime.

This action and others adopted by the Tax Authority, together with relieving legislation already initiated, is intended to increase the confidence between you and the Tax Authority.

I hope that the above action will indeed help make it easy for you to pay the right tax. On this occasion I wish you and your family a pleasant holiday Comments Have Israelis been paying the wrong tax until now? Presumably that isn’t what the tax director meant to imply.

It has been announced that the tax director has only a year left in office before he will be replaced by a rival candidate for his job, Moshe Asher. So now is a good time for a vision.

The question of what is the right tax to pay is a subjective matter. Zero would be nice, but that would not finance the running of the country. At the end of the day, the Knesset determines tax levels, not the tax director. He hints there is relieving legislation on the way; it will be interesting to learn more.

And if the new technologies include social media such as facebook, do we get to express whether we ‘like’ the prescribed tax levels? As always, consult experienced tax advisers in each country at an early stage in specific cases.

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Leon Harris is a certified public accountant and tax specialist at Harris Consulting & Tax Ltd