Israel to levy new second home tax

By Nathan Jeffay, December 20, 2013
Follow The JC on Twitter

The cost of maintaining a second home in Israel will rocket on January 1, when a new regulation will double council tax on properties that lie empty for most of the year.

Last week, the Knesset approved the increase in taxes for so-called “phantom apartments”, following years of complaints by municipalities in tourist areas such as Jerusalem and Tel Aviv.

Councils have argued locals cannot find housing, while there are homes that are hardly occupied.

They also claim that the social fabric of neighbourhoods is damaged when large numbers of homes are empty.

Finance Minister Yair Lapid hailed the measure as proof that he will “use all possible avenues to solve the housing shortage”.

The Israeli government believes that there are almost 50,000 homes that are normally empty. It will permit municipalities to collect double taxes on any homes that are occupied for a quarter of the year or less. Occupancy will be monitored by patterns of water usage, which is information that municipalities already monitor for water bills.

“Empty space is something that we want to prevent — we don’t want ghost apartments,” said Eytan Schwartz, adviser to Tel Aviv’s mayor, Ron Huldai. “We hope that this will lead to people renting out their apartments.

    Last updated: 9:47am, December 20 2013