Finance Minister Smotrich reimposes tax on sugary drinks, other than diet drinks

 

Finance Minister Bezalel Smotrich (Religious Zionism) has decided to bring back the tax on sweetened drinks, other than on diet drinks.

The tax was imposed during the period when Yisrael Beytenu's MK Avigdor Liberman served as Finance Minister, and it was canceled by Smotrich after he took office.

Now, Smotrich intends to bring back the tax - but only for drinks containing sugar, which are taxed at 1.07 NIS per liter.

The decision is liable to reduce the consumption of high-sugar sweetened drinks, as well as bring hundreds of millions of shekels into the State's coffers each year, helping to offset the cost of the war.

It is expected that the heads of the haredi parties will attempt to pressure Smotrich into retracting his decision.

One of the explanations given in the order is, "Since the cancellation of the tax, there has been a significant rise in the purchase of sweetened drinks, after during the same period when the tax was imposed, there was a drop in the consumption of these drinks. A sharper rise was noted for drinks for which the tax was higher."

The explanation also noted that the manufacturers of these sweet drinks did not drop the price as has been expected, "so that the drop in the State's income from tax was not fully felt by the consumer."