In a recent webinar, we looked at a range of crucial issues in these difficult times including wartime business support. We also discussed planned aid measures for businesses and opportunities to renegotiate existing credits, as well as solutions for employees and tax disconnection in Israel.
Wartime business aid
The current situation is reminiscent of the economic challenges encountered during the COVID-19 pandemic, but the proposed aid measures differ. It is important to note that these measures are not yet official, but are currently being examined by Parliament (Knesset).
The subsidies under discussion are primarily intended to cover companies' fixed expenses. This means that the government plans to support a portion of companies' operating costs, calculated on the basis of their lower billings.
These subsidies will be based on a comparison between current invoicing in October and the same period in the previous year (in 2022), and will vary according to the frequency of VAT returns (monthly or every two months). Unfortunately, there is as yet no differentiation between business sectors, which means that different sectors could benefit from the same level of support, although their economic impact could vary.
Support and tax interface
The tax authorities are committed to providing a reliable, user-friendly interface to help companies apply for these subsidies. However, this interface is not yet accessible, and the publication of precise guidelines is awaited.
As soon as the application system is online, we'll publish this information in a new article.
Period covered and amount expected for wartime business assistance
The period examined for business subsidies will correspond to the months of September and October. For companies filing their taxes every two months, the comparison will be between September-October 2023 and September-October 2022. For companies filing monthly, October 2023 will be compared with October 2022.
As for the precise amount of subsidies, this is not yet definitive, as the law has not yet been passed. It is therefore essential to keep a close eye on official developments and potential changes in these business support measures.
In these times of war and uncertainty, it's essential for businesses to keep abreast of the latest support measures, follow official announcements closely and be prepared to use the tax interface when it becomes available. All of these measures are aimed at mitigating the economic effects of these difficult times, offering companies potential support in coping with the current challenges.