Israel’s chief economist resigns over Yair Lapid’s housing plan

(Israel Hayom/Exclusive to Dr. Michael Sarel, head of the Economics and State Revenues Department at the Israeli Finance Ministry, has resigned in protest against Finance Minister Yair Lapid’s plan to provide first-time homebuyers with a tax exemption for purchasing new apartments.

“The decision is wrong from every perspective,” said Sarel, who until Wednesday was considered to be a close ally of Lapid. Sarel said he publicized his resignation letter so his name would not be linked to the new policy.

This is the first resignation of a Finance Ministry official over Lapid’s tax break proposal. The plan, revealed Tuesday, would exempt married couples with at least one child who has done military or national service from paying the 18 percent value-added tax (VAT) on a new home purchase. The suggestion has sparked criticism in areas that do not meet the criteria, like the haredi and Arab communities.

Lapid thanked Sarel for his “trustworthy and professional service” and said he was sorry about the chief economist’s decision to leave the ministry.

Posted on March 20, 2014 .