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Municipal parking fines worth NIS 400m.


I just read an article how arnona will go up by 2015 and then saw this article. Is there no relief in sight? It just seems the little person who works 2 jobs or long hours to manage financially every month, this system will work against us especially if they will be using a remote control device .

Tel Aviv leads collection, and Jerusalem will boost revenue with automated enforcement.

It isn’t easy to obtain figures for revenue from parking fines in Israel, because they are buried deep in the budget reports of the municipalities and local authorities. But the search is worth it: the figures show that this is a huge industry that generates an aggregate of more than NIS 400 million annually. This money represents a vital part of the municipalities’ income, reaching as much as 5% of their total budgets in some cases.

The record holder is the Tel Aviv municipality, which garnered NIS 142 million just from parking fines last year, several million above the forecast, and close to 3% of its total revenue. For the sake of comparison, in the same year, the Tel Aviv municipality’s revenue from fees for legal parking, in parking lots, via mobile telephone and by other means, was half of this, just NIS 72 million.

The Jerusalem municipality collected only NIS 50 million from parking fines, but small authorities in Gush Dan managed to generate revenue of between NIS 5 million and NIS 17 million each. Even a small town like Hadera collected NIS 8.5 million in parking fines last year.

To produce this revenue, the municipalities employ a small army of inspectors, tow trucks, collection agencies and so on, that carry out their work efficiently and stubbornly, and in some cases have quotas and are compensated according to results.

Unfortunately, the municipalities, backed by the state, are not making do with this. Behind the scenes, a technological revolution is taking place that will turn the parking fines industry into an efficient and unwearying high-tech monster, dramatically upgrading its ability to milk us.

One of the leaders in automation is the Jerusalem municipality, which it seems is jealous of Tel Aviv’s fat revenues from parking fines. Last week saw the conclusion of a tender in which the Jerusalem municipality called for information and preliminary proposals for deploying a parking enforcement system based on video, picture identification, and remote control that will operate in all weather conditions, day and night, seven days a week.

The municipality sets out no fewer than 39 parking offences, with fines ranging from NIS 100 to NIS 500, that it seeks to enforce automatically. Technological enforcement will be much more aggressive than current methods, without the discretion exercised by a human inspector. For example, the system will issue a fine even in the case of a vehicle parked legally, if the parking meter tag is wrongly displayed.

Some among us will say, “What’s the problem? Park legally, or take public transport.” If the solution were so simple, we wouldn’t see the item in municipalities’ budgets “forecast of revenue from parking fines”, which turns out to be highly accurate. There are formulae for calculating the average traffic density in a city and the number of available parking places, and hence the fines that will be collected. Besides which, the municipalities effectively control the number of available parking places, and, on the face of it, the revenue from fines reduces their motivation for investing in their provision.

In short, this is a classic case of the cat guarding the cream. Only in our case the cat is about to become equipped with technologies that produce an inexhaustible cream source.

Published by Globes [online], Israel business news – www.globes-online.com – on June 24, 2014

© Copyright of Globes Publisher Itonut (1983) Ltd. 2013

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Bank of Israel study finds that rental prices influence investors more than interest rate


By NIV ELIS    12/04/2013 18:11

 

The percentage of households owning more than one home increased nearly 2.5 times from 2003 to 2012, according to a Bank of Israel study released Wednesday, although recent rules have stymied the trend somewhat.

While domestic investors accounted for 3.2 percent of home owners in 2003, that rate rose to 7.9% in 2012, the study found. Yet new rules meant to make investments in second homes less attractive pushed the rate down about 10% in 2011 and 2012 compared with the first eight years in the study.

“The decline of the share of investors in the housing market is still not significant as the state would like, and it will not make a significant contribution to the lowering of housing prices,” said Zvi Livneh, CEO of mortgage advisory group Livneh-Ben Canaan, who cited the historically low interest rates as the main driver.

“Investments in housing have become central for those who want a relatively solid return of 4% to 7%,” he said. “As long as the interest remains low, investors will be an inseparable part of the housing market.”

While rental yields and interest rates are linked, the study found that when it separated the effects of each on investors, the rental yield had a greater influence.

As rent prices go up, more investors flood into the field; each percentage-point increase in rental yield increased the likelihood that an investor would buy a home by 22%. But every percentage-point increase in the interest rate decreased the likelihood of an investment by only 8%.

The greatest investment demand throughout the entire period was in Tel Aviv, which accounted for 29% of the purchases. In general, people buying second apartments to rent out tend to prefer smaller places, which yield higher relative rents, located in Jewish communities within the country’s center. 

 


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Ministerial C’tee approves 0% VAT on new homes


The bill now moves on to the Knesset Finance Committee.

The changes already made include raising the eligibility threshold for applicants who did not serve in the IDF or National Service from NIS 600,000 to NIS 950,000, and eliminating the eligibility document. The revised bill also sets September 1 for the law to come into effect.

The bill is also opposed by Bank of Israel Governor Dr. Karnit Flug who fears that much of the savings in 0% VAT will not find its way into the buyer’s pockets.

Published by Globes [online], Israel business news – www.globes-online.com – on June 16, 2014

* The big question is, who will it benefit?


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Cabinet unanimously approves zero VAT plan


The goal is for the Knesset to approve the zero VAT bill for first-time homebuyers by September 1.

The cabinet today unanimously approved the zero VAT bill for first-time homebuyers of new apartments. The bill now goes to the Knesset Finance Committee and to the Knesset plenum. The goal is for the Knesset to approve the bill by September 1.

Published by Globes [online], Israel business news – www.globes-online.com – on June 22, 2014