Finance Minister Bezalel Smotrich signed an order today (Tuesday) that raises the VAT exemption limit on purchases from abroad from $75 to $150.
The move aims to reduce the cost of living for Israeli consumers and increase competition with the local market, with the hope that it will also lead to lower prices in domestic stores.
"It could be cheaper here," Smotrich said during the signing of the order, adding that the goal is to fight against large monopolies in the market and force them to compete fairly.
Small business owners, who opposed raising the exemption limit, protested today in front of the Ministry of Finance in protest of the move. They argue that this step will harm them and increase unfair competition with local businesses. In addition, Israeli retailers and merchants are expected to petition the Supreme Court against the new order.
Despite the opposition from business owners, the Ministry of Finance claims that the step is intended to benefit consumers and reduce price gaps between import prices and local prices.