The Knesset's Labor, Welfare and Health Committee approved on Monday the second and third reading of Welfare Minister Haim Katz's (Likud) bill to lower the tax burden on single parents and facilitate their joining the workforce.
The committee approved that the offset percentage for anyone receiving income support or child maintenance assistance from the National Insurance Institute of Israel (NII) will be reduced from 60% to 25%, which will lead to an increase in net income for those affected. This is an initiative from the NII that Katz has championed, its goal being to increase the earning rate of single-parent families.
How does it work? Of a single parent's salary up to NIS 3,200, 25% will be deducted, as opposed to 60% today. In addition, unlike the first version of the bill, single parents receiving income support and child maintenance from the NII right to a work grant will not be automatically cancelled. However, the addition that they receive will be deducted from the grant.
The minister said, "We have successfully created a precedent and led the first step to encourage engaging in the employment cycle by thousands of single parents. Following the reform, the tax burden will dramatically reduce, and families will be able to earn hundreds of shekels more per month."