Iata Threatens Legal Sanctions Against Israel to Force End of Travel Tax

An official of the international Air Transport Association (IATA) said yesterday that its taxation subcommittee would recommend “legal sanctions or proceedings against the State of Israel” to force revocation of its travel tax said to be the highest in the world. Joseph Di Palma, subcommittee chairman, issued the warning at a meeting of local International airline representatives in Tel Aviv. He told a press conference that the tax was “anti-social, prohibitive and discriminatory” and said it violated International aviation accords which Israel has signed.

A spokesman for Transport Minister Shimon Peres said afterwards that IATA had no right to intervene in any government’s taxation policy. Israel’s travel tax amounts to $145 plus 10 percent of the air fare, depending on destination.

TAX IS ANTI-SOCIAL, FAVORS RICH

Di Palma, a tax lawyer and an executive of Trans-World Airlines, said the Israeli tax was invalid because by taxing travel to foreign countries Israel was assuming extraterritorial rights it did not have. He said the tax was “anti-social because the rich will travel in any case” and because “certain segments of the population are exempted and others are reimbursed because it is tax-deductible.” According to Di Palma “the travel tax largely violated the middle class workers’ freedom to travel.” He said discrimination resulted because Israel permits special tax reductions on travel to certain countries such as Cyprus, Rumania, Kenya and Ethiopia.

The IATA official said he visited Israel in 1965 and 1967 to try to have the travel tax rescinded. During his current visit he did not request meetings with government officials. Di Palma did not specify what type of sanctions his sub-committee would recommend.

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