Showing posts with label Municipal tax. Show all posts
Showing posts with label Municipal tax. Show all posts

Sunday, June 25, 2017

The apartment is always bigger on the other side

Lior Regev
Jerusalem Institute for Policy Research en.jerusaleminstitute.org.il

A few months ago the 2017 Arnona (municipal tax) invoice landed in our mailboxes. Next to the total payment due, the invoice notes the size of our apartment, at least as it appears on the municipal registry.

Arnona taxes are one of the main revenue sources for local authorities in Israel, enabling a range of services for residents. Besides size of property, what determines Arnona rates is the property’s use, namely, residential, commercial, services, and the like. Jerusalem has four Arnona districts, each with a different rate per square meter.

As a general trend, apartment sizes in Israel have been steadily increasing over the years. Crumbling public housing, where three children shared a bedroom, might have sufficed in the past, but today every toddler demands a private room. Moreover, living rooms have become a permanent and ever-expanding fixture. And why make do with one bathroom, when we can have two? It is interesting to look at the repercussions of this trend for planning in Jerusalem.

Residential buildings constructed in the 1950s and 1960s offered relatively small apartments. The times demanded housing for hundreds of thousands of new immigrants, and the budget was scant. As of 2015, 56% of the apartments in Kiryat Yovel, 34% in Kiryat Menachem and Ir Ganim, and 43% in the Gonen (Katamon) neighborhoods (A-I) were smaller than 60 square meters (m2).

A decade later, in the 1970s and 1980s, there began to be constructed the large satellite neighborhoods, designed in advance with larger apartments. In 2015, 54% of apartments in the French Hill, 55% in Gilo, and 57% in Neve Yaakov were 61-100 m2 in size. In Ramat Eshkol, another neighborhood constructed during this period, about 60% of the apartments were in this size range. Interestingly, apartment sizes vary among the neighborhoods built during those years because the planners wanted to attract diverse groups. Apartments in the range of 61-80 m2 account for 41% in Neve Yaakov, 40% in Ramat Eshkol, and only 20% in the French Hill.

Jumping forward to the 1990s and 2000s, the trend towards larger apartments continues unimpeded. In two neighborhoods built during those years, Ramat Shlomo and Har Homa, most apartments exceed 80 m2 (82% and 74%, respectively). For the sake of comparison, only 3% of apartments in Ramat Shlomo and 2% in Har Homa are smaller than 60 m2.

So how big will apartments be in years to come?



Translation: Merav Datan

Monday, March 27, 2017

Fight for Your Right (To Pay Tax)

Dafna Shemer
Jerusalem Institute for Policy Research   en.jerusaleminstitute.org.il

Jerusalem’s Arnona (municipal tax) is particularly high, the highest in Israel. In 2014 Jerusalem’s total due Arnona was 1,173,000,00 NIS (New Israeli Shekels) for 212,000 housing units. Arnona discounts amounted to 26% of the total, with 40% of the discounts going to residents from Jerusalem neighborhoods of low socio-economic status (a socio-economic status of 2-5, with 20 being the highest status, according to the 2008 census).
An examination of Jerusalem’s lower socio-economic neighborhoods reveals an interesting picture regarding the exercise of rights on the part of East Jerusalem versus West Jerusalem residents. These neighborhoods are geographically and socially distinguishable as areas populated by the ultra-orthodox (haredi) in West Jerusalem and by Palestinians in East Jerusalem.
Most (72%) of the properties in West Jerusalem that belong to residents of lower socio-economic standing have a ranking of 4 or 5, whereas in East Jerusalem only 49% of the properties belong to residents with a ranking of 4 or 5.
Building on the assumption that people with the same socio-economic status would receive the same discount in Arnona, given their income, we examined lower socio-economic neighborhoods in West Jerusalem and in East Jerusalem. We examined how many discounts were granted on the basis of income, as a proportion of the total number of apartments in the neighborhood. Evidently, the percentage of Arnona discounts based on income, as a proportion of the total number of apartments, is higher in West Jerusalem (39%) than in East Jerusalem (26%). For the sake of comparison, we note that in neighborhoods of higher socio-economic standing (15-19), 6% of the apartments receive a discount on the basis of income.
Both East Jerusalem and West Jerusalem neighborhoods show a decrease in the percentage of discounts granted on the basis of income as the socio-economic ranking of the neighborhood rises. East Jerusalem neighborhoods with a socio-economic status of 2 received discounts for 27% of the apartments therein, whereas West Jerusalem neighborhoods with a ranking of 2 received discounts for 42% of the apartments therein. East Jerusalem neighborhoods with a socio-economic status of 5 received discounts for 15% of the apartments therein, while for West Jerusalem this figure was 35%.
When we examine the total Arnona collected, in relation to the total due without discount, amidst residents of lower socio-economic standing, we find that collection rates in East Jerusalem (72%) are lower than in West Jerusalem (85%). Here too, as the socio-economic status increases from 2 to 5, Arnona collection rates increase. For higher socio-economic rankings (15-19), collection rates are higher too – at 96%.
In sum, one might conclude that residents of West Jerusalem are more effectively exercising their rights vis-à-vis Arnona than East Jerusalem residents. And perhaps as a consequence, Arnona collection in West Jerusalem is more effective and efficient than it is in East Jerusalem.