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Yeshiva Scandal Will Work In Favor Of Yeshiva Bachors

According to a recent report from the Ministry of Education, a state-funded yeshiva recorded nearly 10,000 “ghost workers” on whose behalf the yeshivas received scholarships. According to Treasury estimates, the damage came to something like 55 million shekels a year.

According to reports from Israel’s economic media, this amount will not be returned to the budget of the Ministry of Education, and will actually remain in the yeshiva.

The Ministry of Finance and the Knesset approved a financial decision that the yeshivas obtained funds fraudulently, but the funds nevertheless, will be used to increase the benefits of the students who do learn in these institutions. The Stipend for each student will grow at 60 shekels a month to 515 shekels a month.

Bibi Folds

People power has apparently won concerning the Finance Ministry’s proposed plan to impose VAT on fruit and vegetables sold to Israeli consumers in open air markets as well as in regular supermarkets. After intense pressure from a number of groups, including fruit and vegetable vendors themselves (who staged wholesale dumping of their produce at open air souks around the country) and from coalition partner Shas (many of whose members are poor and have large families), Prime Minister Binyamin Netanyahu overrode Finance Minister Yuval Steinitz‘s to levy the now 16.5 VAT on farm produce, saying that “sometimes it’s necessary to listen to the will of the people”.

vegetable soukBut at the same time, however, the government is now formulating plans to increase the VAT on other items even further – to 17.5% – to make up for the 1.3 billion Shekel revenue short-fall that is expected to occur due to not imposing what is now known as the produce tax. Prior to the P.M.’s decision, many people were calling for Finance Minister Steinitz to resign. Those close to him say he is furious with the decision concerning the produce tax, and will not resign; even though opposition Kadima party members are calling this act “a sign of weakness” on the part of the present Likud party led government.

Raising the overall VAT another one percent will in the long run result in even more economic hardship than the VAT on fruits and veggies, as it will result in all other items, including staples like dairy items, bread, flour, cooking oil, and chickens being more expensive. Besides, it was argued that people would still find ways to circumvent paying VAT on produce purchases by buying from roadside stands and other black market fruit and veggie dealers. The idea to raise the VAT even more is something that had probably been in the Finance Ministry’s game plan since the new government assumed power in April, 2009. Despite a deep recession, the government has been desperately looking for ways to increase revenues without resorting to levying higher income taxes. Another thing that has become the new government’s problem is that the January Operation Cast Lead military operation left a big deficit in the previous government’s budget, which the new government inherited when assuming power. By gradually raising the VAT, the government is applying what is known as the salami technique in which they gradually raise the tax amount, bit by bit, like slicing a salami; until eventually they have the entire “salami” of increases with less protest from the general public.

As you can see, it’s obviously easier to get the entire salami, slice by slice, instead of trying to take the entire portion at once. The question now, however, is whether people are gullible enough to fall for this ploy; or whether they really can do anything about it, outside of outright rebellion.

Maybe Israelis will be more successful than the Iranians were at protesting government imposed policies. It all depends on how we like to eat our salami.

Hirschson Going to the Big House

The State has demanded at least 7 years incarceration for the former Finance Minister Avraham Hirschson. Prosecutor: Hirschson has violated public trust, leaving a feeling that public figures are living high on the taxpayer’s expense. Elroi Hirschson: It breaks my heart to see my father at the defendant’s table; imprisonment will actually be a death penalty.

Two conflicts in the courtroom: the need to hand down a deterring punishment – and the desire to show a little mercy. The son of former Finance Minister Avraham Hirschson, whom the court last week determined had misappropriated vast sums of money from the National Histadrut, said on Thursday morning at a plea hearing at the Tel Aviv Regional Courthouse that imprisonment of his father would in actuality be a death penalty.

EX Finance Minister Avraham HirchsonThe prosecutor, adv. Eli Schwartz, asked the court to deliver a long, deterring sentence, more severe than the ones handed down to his partners in the case. “They obtained their strength from him, he is first and foremost”, he stated. In this context – he repeated that the State had demanded a 7-year sentence for Ovadia Cohen, one of the accused in the case. In his opinion, Hirschson’s sentence should be more severe, should include a suspended sentence with strict fine, and his actions should be determined a disgrace.

Over the last several months, the Court has delivered verdicts of four years’ incarceration to Cohen, who was head of the Financial Dept. of the National Histadrut; 40 months of direct incarceration to Nili’s accountant, Amatsia Bonner. Fifteen months of incarceration were handed down to former Histadrut director, Yitzhak Ruso; the organization’s bookkeeper, Ronit Garti, was sentenced to public service. All four confessed and were convicted within the framework of a plea-bargaining.

The prosecutor also stated in his plea for sentencing that he does not downplay Hirschson’s good deeds over the years, or his activities for the benefit of Holocaust survivors – but at the same time, public representatives who use their positions as a means for personal financial gain should be severely punished.

Schwartz added that Hirschson has violated public trust, leaving a feeling that public representatives live high on the taxpayer’s expense, and added that Hirschson has lived his daily life while continually committing felonies over the years.

Son Elroi, who wept when the verdict was read, has asked for mercy for his father, who was only recently able to see his first grandchild;

“My father is the most important figure in my life. I have memories of my mother’s misery and suffering during the first years of my life. My father did everything for my mother; he took care of her for years and was both a father and mother to us. When people asked me what it was like to grow up without a mother, I would tell them that God had blessed me with such a warm and loving father that I don’t know where he gets his mental strength from. ”

“It breaks my heart to see my father at the defendant’s table. I am waiting for someone to wake me up from this nightmare,” added the son and stated that since the publication of the first article on his father’s deeds he hardly leaves the house: “The articles are being written one after the other and there seems to be a competition to see who can write a more condemning story. My father’s life has not been easy; he lost my mother to a fatal disease. I wouldn’t wish anyone to go through the suffering he has known.”

Hirschson has been charged with embezzling approximately 2 million shekels from the National Histadrut, and with taking bribes. The judge stated that the National Histadrut and Nili, under the former finance minister’s management had become a “casino” in which all senior representatives win money that is not theirs. Hirschson’s lawyer has already announced that he will appeal the conviction.

The former finance minister has also been charged with theft under management, fraud under aggravated circumstances, fraud and violation of corporation trust, laundering funds and falsification of corporation documents. Along with this, the Court has acquitted Hirschson on two accounts – financing the primaries and financing a conference at Ganei HaTa’aruha. The verdict will be served this Wednesday.

Translated by Lori Bul.

Priming the (gas) pump

Gasoline Pump
Aren’t those Israeli finance ministry people clever? It was just the other day when Yuval Steinitz, Bibi Netanyahu’s Finance Minister, was expressing he regrets over the decision to charge VAT on fruits and vegetable sold in open air and similar markets. The uproar this decision created resulted in the government deciding to back off from their unpopular decision, as trying to collect these revenues might prove to be a bit dangerous, to say the least. Besides, the poor folk have been battered enough, especially pensioners and other weaker elements of our society.

But wait – there’s better ways to fleece the public, and bless our government to come up with just the perfect to get extra money from everybody, both rich and poor alike. And that better way it to hike up the taxes on gasoline, as this can be collected automatically at source and won’t affect many of the poor folk as long as they don’t have car.
Raising the price of fuel by 30 Agorot a liter, about 7.33 US cents, will not only raise a nice amount of needed revenues but not cause a revolution either. When pepole don’t have a choice, they pay what they have to since they don’t have much of a choice otherwise. The new levy will raise the price on 95 octane unleaded to NS 5.79 per liter at self-service stations.
The new gasoline tariff will go along with other austerity measures, including increasing VAT (on all other goods and services) to 16.5%, increasing contribution amounts required for National Insurance, municipal rates increases, and other means. Since most really poor folk don’t own a car, they won’t get stung with higher gas prices. Just the rest of us will. Most likely employees driving lease cars will have to pay a bit more for this privilege – too bad! Most likely a “beer and booze tax is also in the works too. That’s also something the public has no control over. It’s either that or take off child allowances even more. And that will make government coalition partners (like Shas) head for the hills.

OUCH! Bibi does it Again!

In what many people are considering to be a shocker, the Netanyahu government’s Finance Ministry announced their proposed economic plan on Thursday. The Finance Minister, Yuval Steinitz (or is it really Bibi with Steinitz only filling the position as a “stooge” for Netanyahu), presented the new budget, which includes some changes that are reminiscent of Netanyahu’s previous stint as finance minister during Ariel Sharon’s term in 2005. Some of the new budget changes include:

1. A sharp 10% reduction in child allowances with an aim to “equalize” the amount a family receives for each child from National Insurance. This will severely hurt religious families, and has enraged Shas Party members, who agreed to join the Netanyahu government in the first place when he agreed to their demands, including those involving child allowance.

2. Reducing the Defense Ministry’s budget by NS 2.5 million and forcing the IDF to raise its retirement age for career soldiers as well as the amount of pensions received (sorry guys and gals, no more “golden parachutes” at age 45).

3. More restrictions on persons filing for unemployment: persons up to age 35 will only receive benefits for 45 days; 35-45 for 60 days; and over 45 for 90 days. When asked what people will do with so few jobs available, the answer was: Well, there’s gas stations, supermarkets, and “yesh neshek?” (the “do you have a gun?” question security guards ask people going into shopping malls, etc.).

4. Benefits for pensions and disability payments will be “frozen” until the end of 2010 with no cost of living raises, etc.

5. And, something that everyone who has to spend time in a hospital will feel: 50 NIS ($12) daily surcharge for each day spent in hospital (people won’t be so keen to stay there long, especially elderly people on limited incomes). And this sum is in addition to all other “out of pocket” amounts due.

All of this couldn’t have come at a worst time for most people with more than a quarter million Israelis “officially” unemployed and everyone feeling the sharp sting of this current recession (especially Bank Hapoalim’s head Shari Arison, who in addition to all her other problems is now planning to divorce her current husband, Ofer Glazer – yeah, that guy who spent some time in jail for “bothering” a female employee on Arison’s yacht. Shari may have to sell that too, to raise some badly needed cash).

All in all, it doesn’t bode well for us simple folk who are just trying to keep from drowning in very deep financial waters.

Benjamin Netanyahu to become Italy’s Finance Minister

This week at a legal society dinner Benjamin Netanyahu (AKA. Bibi) told the audience that he was offered the position of Finance Minister in Italy by a prominent Italian Businessman, but alas politely refused. Maariv followed up on the story and found out that it happened a little differently. Bibi and Israel’s ambassador to Italy were walking out of the King David Hotel in Jerusalem and ran into an Italian businessman walking in. The man was introduced to Bibi by the ambassador and spoke to him for 3 minutes.

When asked about Bibi’s claim and job offer, he reportedly said that during that brief introduction he mentioned that Italy needs to get its financial affairs in order and that some of the steps taken in Israel should be adopted. Needless to say he was amazed by Bibi’s claim and explained that he was in no position to offer the job, even if he was so inclined.

We’ll miss you Bibi..

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