Finance Minister Ronnie Bar-On has decided to cancel customs payments for a trial period of six months on medical equipment and devices imported from countries with which Israel has no free marketing agreements.
Last year, the Treasury earned almost $2 million from customs on such products, out of a total of $50 m. in imported medical devices (not including those made of textiles, rubber and plastic).
The experiment was initiated by Uriel Lynn, president of the Israel Chambers of Commerce, who argued that charging customs on such products was an "anachronistic policy that has no room" in Western countries.
Most such medical equipment and devices are brought in by medical centers and health funds, which pay a 12 percent customs duty on them if imported from countries with which Israel has no free-market trading agreement, such as China, Japan, Australia, India, New Zealand and countries in southern Africa.
The Treasury will see how the experiment affects medical institutions and state income before deciding whether to make it permanent.
Yehuda Gil, chairman of the medical equipment branch of the Israel Chambers of Commerce, said that the existence of the customs duty and procedures needed for receiving individual exemptions involved a lot of red tape.
"There is no reason to prevent free and open competition on products whose contribution to public health is significant," he said. "I hope that in six months, the finance minister will make the exemption permanent."
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