אבי אהרן

Uriel Lynn is a prominent Israeli capitalist. He is the presidents of The federation of Israeli chambers of commerce, had been a member of the Knesset for decades and an enthusiast defender of capitalism (he’s an hebrew article defending the rise of the Shekel and calling to abolish protectionism).

In a recent article, however, Lynn complains about the rich who don’t pay enough taxes. Not the most capitalistic opinion you’ve ever heard from Lynn. What could cause a capitalist to call for increased income tax?

Well, it is the government, of course, who had managed to trick the Israeli capitalist one more time.

As in most of the western world, the Israeli income tax is “progressive”. That is, the tax percentage increases with your income. for the first few Shekels you pay 10%, for the next few Shekels, you pay 20%, up to 58% of direct taxes (income tax, social security and mandatory health insurance combined).

Last year, the ‘capitalistic” goverment of Netanyahu has decreased taxes for one of the taxation levels, cuasing a little anomality (see the linked article for the exact numbers). Mr. Lynn, instead of calling for the abolition of direct taxes altogether, would settle for a little justice. “Justice”, when it comes to your relationship with your goverment, could be simply a cancellation of this tax cut. It’s a love-hate sort of relationship, and in case you didn’t know, you’re the one that finds himself eye folded and tightened to a low bench.

Defenders of capitalism in Israel – and Lynn is a respected leader of this crowd – have to avoid pitfalls of that kind. It is much simpler to call for the abolition of direct taxes altogether. The goal is to keep the taxpayer’s money where it belongs. Why settle for less?