After long negotiations, the Finance Minister Moshe Kahlon and Minister of development of the periphery Aryeh Deri has reached an agreement over the reduction of prices for travel in public transport and water rates.
Recall that these objectives were spelled out in the coalition agreement when entering the party SHAS in the coalition.
Aryeh Deri has demanded that the tariff reduction was effected by cancelling the VAT, so it is difficult to increase back, however the Finance Ministry was categorically against the introduction of a differentiated VAT.
In the end, the VAT will remain unchanged, however discount will be provided under a special law, which stipulates that the discount rate is equal to the size VAT at the current moment.
In the end, the real reduction in prices after the adoption of the law will be 14.5% as discount of 17% will be calculated from the rates without VAT.
It should be noted that the bill will not apply to taxis, which will have to reduce tariffs without receiving subsidies from the state.
Water tariffs will also be reduced by the VAT, but only for the cubic meters and paid at a lower rate. The price of water beyond the quotas will not change.
Since the discussion was delayed until 28 December, to take effect January 1, as promised Earlier, lower prices will not. Approval of bills, even under the accelerated procedure will take two-three months.