After Tragic Deaths: Israel Tax Authority Sets Its Sights on Unlicensed Daycare Centers
In the wake of the deadly incident at a children’s daycare center in Yerushalayim, the Israel Tax Authority is examining the possibility of launching audits and investigations into the financial conduct of daycare centers and toddler frameworks that have been operating without licenses and without being formally registered as businesses, according to a report by Ynet.
Officials stressed that the review is not directed at the specific daycare where the tragedy occurred. However, they emphasized that any suspicion of long-term tax evasion grants the Tax Authority full legal powers to examine the matter, demand the filing of reports, and collect back taxes retroactively, in accordance with the law.
Professional sources noted that there are numerous daycare centers that are not registered with tax authorities and do not submit annual reports, despite operating for extended periods and receiving regular payments from parents. Under Israeli law, even small frameworks or those serving economically disadvantaged populations are required to declare and report income, regardless of the amounts involved.
A tax attorney told Ynet that the Tax Authority has both civil and criminal tools to locate businesses that fail to report income. In cases where there is no cooperation, the Authority is empowered to assess income independently. He added that while many cases initially proceed on the civil level, more serious situations can escalate into criminal proceedings.
The Tax Authority further clarified that statutes of limitation apply only to those who submitted reports as required by law. In cases where no reports were filed at all, authorities may review conduct retroactively, depending on the circumstances and the severity of the findings.
Sources familiar with the matter told Ynet that the Yerushalayim incident is likely to prompt a broader review of unlicensed and unreported educational frameworks, as part of a wider effort to combat the shadow economy and enforce tax laws.
{Matzav.com}
