Tax Authority (Shutterstock photo)
In the case of smuggling goods into Israel, the minimum fine imposed is the amount of the administrative fine, that is, the amount of unpaid taxes. Thus states a precedent ruling of the Supreme Court given by a panel of three judges: Honorable Judge David Mintz, Honorable Judge Khaled Kabov and Honorable Judge Ruth Ronan.
The verdict was given in an appeal filed on behalf of Moshe Bonfed, who was caught by the customs inspectors in July 2017 when he was passing through the green lane, designated for passage without taxable goods, with 238 packs of cigarettes in his suitcase. In tax, he was liable for VAT, customs and purchase tax in a total amount of approximately NIS 54 thousand.
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The representative of the tax authority requested to impose on the defendant a fine that will not be less than the amount of the unpaid taxes, according to the rate of the administrative fine imposed in such cases. The Magistrate’s Court in Rishon Lezion sentenced Bonfed to a fine of NIS 50,000 to be paid in 50 consecutive and equal monthly payments, in light of his financial situation. The defendant’s attorney appealed the sentence to the District Court in Lod, arguing that the Magistrate’s Court did not sufficiently consider the financial situation of the defendant in determining the fine, and it should have deviated significantly more from the minimum fine required by the Tax Authority.
The district rejected the appeal and stated that “this is an economic offense which was committed for the purpose of financial gain and under these circumstances it is appropriate to impose a fine, an amount that properly reflects the scope of the offense as well as the amount of tax that the appellant sought to avoid”. The defendant’s attorney submitted a request for leave to appeal and a hearing was scheduled for his case.
The supreme judges were not satisfied with rejecting the appeal authority, but also set an important precedent regarding the determination of a punishment complex in cases of smuggling goods into Israel. “A criminal in our case, even when imposing a fine in a criminal proceeding that has passed an administrative proceeding, an adequate punishment complex must be determined,” wrote the supreme judges in their ruling. “In this context, the bottom of the compound is usually appropriate for the rate of the administrative fine and no less. In this procedure, the fine imposed on the applicant does not exceed the appropriate fine and therefore we saw no reason to give the applicant permission to appeal.”
This ruling supports the Tax Authority’s position in recent years, that in cases of smuggling goods into Israel, an administrative fine must be imposed equal to the amount of the unpaid taxes, and that in serious cases referred to criminal proceedings, a range of punishment must be established that varies between the administrative fine and an amount up to 4 times that amount.
The Tax Authority was represented by Attorney Ronit Shemesh-Menor at the Magistrate’s Court, Attorney Emily Cohen-Afriat at the District Court and Attorney Yoram Hirshberg at the Supreme Court.
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