Summary:

  • Economic incentives are an increasingly important component of environmental policy in many countries. The use of such incentives can be expanded in Israel as well, which would contribute to both the achievement of environmental objectives and the integration of Israel within global environmental trends.  
  • This chapter discusses the possibility of expanding the use of economic incentives in Israel in three areas: waste disposal, the number of private vehicles and their usage and increasing building density as part of planning policy.  
  • Israel lags far behind other developed countries in the area of waste disposal. About 87 percent of the waste in Israel goes to landfill, which is the worst solution from an environmental perspective. Israel has recently adopted a policy to reduce the share of landfill, including a landfill tax and the transfer of responsibility to the producer, which provides local authorities and producers with incentives to recycle and to reduce landfill.  
  • An econometric analysis shows that increasing the excise tax on gasoline together with reducing the purchase tax on new vehicles would reduce the mileage of private vehicles and thus improve the quality of the environment without reducing tax revenues.  
  • The proportion of low-density buildings in densely populated districts has not declined in recent years and in districts with an intermediate population density it has even increased.  

 Welfare Policy Issues - Full File