Finance minister warns he'll topple gov't if apartment tax rejected

Moshe Kahlon’s proposal would bill owners of 3 or more homes; some opposition members say they’ll help pass legislation

Finance Minister Moshe Kahlon said Friday that he sees a bill to tax owners of three or more homes as an essential condition to his party remaining in the coalition, and threatened to topple the government if the legislation failed to go through.

According to a Channel 2 report, Kahlon said that if the bill doesn’t pass, he will “also break my commitments and [the government] will break apart.” According to the report, members of the opposition say they will support the bill and give Kahlon a “safety net.”

The Kulanu party head warned other ministers that he would not support their legislative proposals if they failed to back him on his.

“A large part of the bills you pass, I dislike. If you start breaking your commitments I will break mine,” Kahlon told ministers at a recent meeting of heads of parties making up the government.

Kahlon said he would not be willing to change the bill significantly, despite opposition from senior Likud members.

The bill was announced by the Finance Ministry in July. According to the proposal, holders of three apartments would pay a new tax of NIS 10,000 per year ($2,600). Owners of four apartments would pay NIS 22,000 ($5,800) per year and owners of five would pay NIS 37,000 per year ($9,750).

According to Finance Ministry data, there are 38,232 families holding three homes, and more than 54,000 of holders of three or more homes. Twenty-one families in the country own more than 20 apartments each.

The third homes make up 12 percent of the rentals market. The tax – if the bill passes – would be enforced on 80,000 homes defined as a third house or more.

Meretz leader Zehava Galon pledged to support the bill – giving Kahlon the votes of all Meretz members. Some members of Zionist Union, including Shelly Yacimovich, also said they would vote for Kahlon’s bill.

Staff in Kahlon’s ministry were surprised when Prime Minister Benjamin Netanyahu told Channel 2 last month that he may abstain from voting on Kahlon’s bill since, as the owner of three homes, he could be considered to be facing a conflict of interest.

Yacimovich at the time took to Facebook and mocked Netanyahu, saying the reasoning could not hold in the case of a serving prime minister.

“You didn’t really say that, did you, Mr. Prime Minister? […] Because if you are [saying that] then you can’t vote on transportation because you travel on roads, […] you can’t vote on taxes because you pay taxes, you can’t vote on health because you have health insurance and on environment because you breathe the air,” Yacimovich wrote on Facebook.

Netanyahu’s comments were also criticized by Justice Minister Ayelet Shaked. “Ministers and members of Knesset, when it comes to a nationwide and general issues like taxation are not in a conflict of interest. I will ask the attorney general to clarify this. We cannot neutralize elected officials,” Shaked said.

“Members of the coalition will need to choose if they support a decision helping young couples and the middle class or joining Yair Lapid protecting the one percent,” Kahlon wrote on Facebook Friday, in a stab against his predecessor in the role of finance minister.

“The goal in the third-home plan is to free up apartments and increase supply,” he wrote.