Israel's ministers of finance and agriculture have decided that the agriculture sector will be exempt from paying a tax on foreign labor employed in agricultural operations, as of 2016. Additionally, agricultural employers will be eligible for further write-offs relating to their expenses made on foreign labor forces.
The move is expected to save growers 16,000 shekels per year on average; amounting to over 100 million shekels in total savings in the sector. Tax currently makes up 10% of the labor costs of every foreign laborer, with only 230 shekels of additional expenses allotted per worker. Scrapping the tax and increasing the expenses figure to 530 shekels per worker is set to decrease growers' expenses by tens of thousands of shekels per year.
The decision came after a long and widely publicized struggle by the agriculture sector against the current law. The head of the Israeli Farmers Federation, Meir Zur, said "I am happy and thankful to the finance minister that he realized the importance of the ruling and the damage it could have done to farmers in Israel. We intend to continue negotiating with the government bodies until we can restore farmers' ability to make a living in this country."
Indeed the committee which was established to discuss the taxation issue is set to continue its work on the fresh produce market, with the aim of solving issues such as the high rates of arbitration between farmers and wholesalers, the inefficient governmental support programs, and encouraging the expansion of agricultural operations.
