Yesterday (Thursday), Prime Minister Benjamin Netanyahu instructed the Minister of Finance, the Governor of the Bank of Israel, the Director-General of the Prime Minister’s Office, and the heads of the Tax Authority and the Task Force Against Crime in Arab Society to convene a special meeting aimed at completely abolishing the 200-shekel note, which features the portrait of the poet Nathan Alterman. The note, which entered circulation in November 2015, may soon be withdrawn as part of a comprehensive plan to combat money laundering in Israel.
According to the plan, developed by a team of economists, the abolition of the note is expected to be a central step in the fight against money laundering and contribute significantly to increasing state tax revenues, with an estimated boost ranging between 90 and 115 billion shekels by 2030. The decision to include the abolition of the note is aimed at preventing criminal entities from using cash to conceal illegal funds. A senior economic official stated that the success of the move depends on an urgent announcement of the abolition, which will allow for a short window for exchanging the note, making it harder for criminal organizations to dispose of millions of notes.
Alongside the abolition of the note, the plan includes additional measures to reduce the use of cash in the medium and long term, with the eventual goal of eliminating cash entirely in Israel in the coming years. In the future, all payments will be made exclusively through direct bank transfers or credit cards. Additionally, a “campaign” will be launched allowing individuals who previously concealed income to report it and pay taxes without facing prosecution.
One of the other changes in the plan is lowering the threshold for transactions requiring prior approval from the Tax Authority from 25,000 shekels to only 5,000 shekels. This change has sparked opposition from business entities and the Chamber of Accountants, who argue that such a move will complicate and burden payment systems in the economy.
During the implementation of the plan, tax evaders and money launderers will be required to deposit their cash in banks while providing proof of the source of the funds. It is also noted that in other countries, such as China, similar measures have already been implemented in certain cities, where the use of cash has been completely banned.
