Tax Man: Letter Campaign Effective in Getting People to Pay

The Tax Authority is very satisfied with the results of a recent dunning campaign in which it sent out tens of thousands of threatening letters to tax deadbeats, said Moshe Asher, Director General of the Israel Tax Authority. The campaign resulted in the addition of NIS 650 million to state coffers over the past year. As a result, a new round of letters is being drafted, Asher said at a conference on fighting contraband trafficking.

A total of 118,000 letters were sent out last year, said Asher, and some 30,000 new case files were opened on serious tax evaders. The result was a large windfall for the Authority. “This is not a one-time program,” said Asher. “Israelis realize the importance of making taxation fairer, and a more equitable distribution of the tax burden.

“They also know that unless we pursue the self-employed and business owners who may be cheating on taxes, the salaried employees whose taxes are deducted at the source will end up paying more,” he said. “Fairer tax collection allows politicians to give more to the people. Everyone understands that unless we can bring in the tax payments in a fair and equitable manner, that political instability could result.”

According to some estimates, as much as two-thirds of Israeli economic activity occurs “under the table,” out of view of the tax man.