Israelis who have been paying a customs tax on online purchases can rejoice: The tax has been rescinded. From now on, purchases of up to NIS 1,200 (about $300) will be exempt from the customs tax. The move comes in accordance with the recommendations of the Trajtenberg Committee, appointed to address the demands of the social justice protest movement that arose this last summer. The exemption will include items ordered by individuals and shipped by air or sea. Prime Minister Benjamin Netanyahu remarked during the weekly cabinet meeting on Sunday that this exemption will stimulate competition and ultimately lead to lower prices. However, the exemption does not include tobacco products or medication. Under current legislation, online purchases of under $50 are already exempt. Raising the amount to NIS 1,200 does not require any further legislation so the approval in the Knesset was speedy. The exemption will be implemented upon being approved by the Finance Ministry in early January. The 16 percent Value Added Tax will still be required. Initially, the cabinet was to increase the limit to NIS 1,000 but the ceiling was raised during the course of the cabinet meeting to NIS 1,200 a 20% increase. The cabinet was set to discuss several additional Trajtenberg recommendations on Sunday, but due to lack of time the discussion was deferred. Several ministers complained that they had not been given enough time to study the Trajtenberg report and asked to delay the vote on its contents. The prime minister agreed to wait until next week. "The benefits we will discuss will lower the prices of housing, natural gas and fuel," Netanyahu said, outlining the Trajtenberg recommendations. Finance Minister Yuval Steinitz added that the recommendations submitted to the ministers had been adjusted in accordance with a cabinet vote six weeks ago. "The Trajtenberg train is leaving the station today," he said. "I suggest that all of you, including the defense minister, get on board and refrain from delaying the train." Steinitz was referring to the tension between his ministry and the Defense Ministry over the Trajtenberg recommendation to slash the defense budget in order to fund social programs. Another tax reform taking shape is the plan to lower income tax on salaries between NIS 8,000 (about $2,000) and NIS 14,000 (about $3,500) by 2%. This will add up to NIS 65 to a monthly wage. The Knesset plenum is also set to vote on a bill that would reverse the customs tax exemption at duty free stores to fund the income tax reduction. Meanwhile, in another social justice movement success, Israeli food giant Strauss has announced it will lower prices on dozens of popular products. The prices of 36 products will be lowered by 5% - 10% - products like hummus, chocolate and coffee. Strauss has already lowered the prices of 18 products by 6% - 17%. Alongside the lowering of prices, Strauss announced that it would freeze wage hikes for executives and speed up the absorption of contract workers into the company. The company will also offer financial incentives to its lower wage earners, grant 100 academic scholarships to workers' children, and expand benefits packages to better suit its employees' needs. Strauss CEO Zion Balas said Sunday that "this move has been in the works since this summer with the emergence of the protest movement. We realized that it was not enough to lower prices, we also had to consider the 6,000 employees we have in Israel."
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