Sources inform ''Globes'' that the Bank of Israel Research Department is carrying out a thorough review of Israel's tax system to create a factual basis for upcoming decision-making by the Ministry of Finance and Israel Tax Authority on pending tax hikes to meet the deficit target.
The sources added that the Research Department's review includes simulations of tax hikes, including VAT, income and company taxes, and real estate taxes, on tax revenues, the deficit and economic growth.
Bank of Israel officials confirmed the report, saying that there was an explicit request, apparently by Governor Stanley Fischer, to complete the study as soon as possible, and before the critical talks on the tax hikes.
A key purpose of the Bank of Israel's Research Department is to provide a factual basis for economic policy in every field. At today's Caesarea Forum, senior Bank of Israel officials, including Fischer, are saying that there is a need for a permanent tax hike. The Research Department study is intended to give the officials the means to influence the process.
Published by Globes [online], Israel business news - www.globes-online.com - on June 28, 2012
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