Daily Israel Report
Show More

OpEds


New Way to Make Money in Israel: Informing on Tax Cheats

The Tax Authority is making it easier for Israelis to “rat out” tax cheats, and raising the rewards for Israelis who do so
By David Lev
First Publish: 11/13/2012, 1:46 AM

Tax Authority office
Tax Authority office
Flash90

The Tax Authority plans to substantially expand a program in which Israelis can earn money for “ratting” on tax cheats. A report Monday said that the Authority will pay out more money more quickly, for information on cheats who have failed to report or pay even small sums that they owe.

The long-running program will also be the subject of a media ad campaign, as the government searches for ways to increase income. In recent weeks, reports said, international credit agencies have warned the government that if Israel did not do something to either cut spending or increase government income, Israel could face a credit rating cut.

In order to avoid that, Prime Minister Binyamin Netanyahu and Finance Minister Yuval Steinitz have proposed budget cuts and tax increases, but the Authority believes it can raise tens of millions of shekels by just performing better enforcement of tax laws already on the books. A spokesperson for the Authority said that the “informant” mechanism is one of the Authority's tools for increasing the state's rightful income.

The information is sent to the Authority via a link on its web page, or in person at a Tax Authority office. If the information seems credible and is likely to bring in a substantial amount of tax money, the information is transferred to the Authority's investigation department, where it is checked out.

Until now, a reward was offered only in the event that the information led to a criminal conviction. Under the rule change, “rats” will be able to get paid even if the Authority does not press charges, and the case remains a civil one instead of a criminal one. The amount to be paid out will depend on how much money the state rakes in as a result of the information, an Authority spokesperson said. If the scofflaw turns out to be a millionaire, informants could earn tens, or even hundreds of thousands of shekels, the spokesperson said.