The Finance Ministry has circulated the full outline of a new compensation program for business owners whose property was damaged in protection-racket extortion cases, ahead of government approval. The initiative, promoted by Finance Minister Bezalel Smotrich, would run as a temporary six-month pilot and set aside NIS 30 million for the Tax Authority compensation fund.
The money is intended to reimburse businesses for direct physical damage to property when insurers refuse coverage. Under the draft decision, the main threshold for receiving payment from the Tax Authority is filing an official complaint with the Israel Police about both the extortion offense and the resulting damage.
The plan, whose main elements were reported about a month ago by ynet, amounts to an official state admission that it failed to protect victims of protection rackets. Its purpose is to provide victims with a safety net and reduce the incentive to cooperate with criminals by paying protection money.
Inside the Finance Ministry, senior professional officials sharply criticized the police and the National Security Ministry, saying large budget increases had not produced security on the ground. One official said, “Despite the huge budget the police received as an addition to its budget over the past two years, it is failing miserably to eradicate the protection racket phenomenon. Now the taxpayer has to pay for this ineptitude.” MK Zvi Sukkot, who pushed the plan, said Israel needs people willing to refuse extortion and added, “The Government of Israel will have the back of those heroes and compensate the losses.” During the pilot, the government will examine how effective the model is, and the police will have to pass all relevant information to the Tax Authority. After cabinet approval, the plan will be published for public comment so businesses, economic groups and the broader public can help shape its final version.
