Financial Benefit Only… or Is It?

Last week, the Knesset Finance Committee decided not to cancel the tax benefit that is given to foreign reporters stationed in Israel. This welcome decision raised a discussion on the financial benefit versus the damage to Israel's image.

The representatives of the Ministry of Finance claim that cancelling the benefit, which gives the foreign correspondents a lower tax level of about 25%, will increase the country's coffers by a million shekels each year. However, after a deeper examination was done by the Knesset's Research Department, it was seen that cancelling the benefit will in fact add only a few thousand more shekels to the national treasury. Either way, we should not narrowly look at the issue only in terms of the profit to the treasury, but consider the issue in its entirety, including the damage to Israel's image.
 

Recently a few countries in the Middle East decided to exempt entirely the foreign reporters from paying income tax. This decision indicates how fragile is the reality in our region, and all a reporter has to do, if he wishes to continue reporting from this area, would be to move to the Palestinian Authority or to one of Israel's neighbors. By doing so, the reporter will lose his commitment to his Israeli sources and to fair reporting.
 

Therefore, there is a need to examine in-depth the influence that cancelling the benefit would have on Israel's image and thus, indirectly, also on Israel's coffers. We have to remember that the foreign reporters, who cover Israel, are the ones that decide how to portray the situation and events in our small country and that their decision has a crucial impact on the way Israel is viewed around the world. Their influence is so crucial that a negative depiction in the foreign media would directly impact on tourism, foreign investments, and the local industry.
 

Thus there is a need to examine the bigger picture regarding the damage that would be done to Israel by cancelling the benefit, and not to consider it only from the narrow economic perspective.