Finance Minister Bezalel Smotrich on Tuesday signed an order expanding the value-added tax exemption on personal imports from $75 to $150, arguing that it is necessary to allow cheaper imports to encourage competition and lower prices.

The move will go into effect on Wednesday. The VAT, a type of consumption tax, is set in Israel at 18 percent.

In a statement, Smotrich said it is part of “a broad and significant series of steps” aimed at lowering the cost of living, alongside efforts to shake up the banking and dairy sectors.

All of these steps are predicated on the proposition that “it can be cheap here,” he said, arguing that “the Israeli economy is often dominated by a small number of strong monopolies,” giving consumers only the illusion of choice.

“There is no reason why an international chain’s garment should be sold here for” significantly more than abroad, he argued. “There is no justification for a shoe that is sold in the United States for half the price – to be........

© The Times of Israel