Court Cancels 163,000 Shekel Tax Debt on Former Grocer After 19 Years Due to Statute of Limitations

A northern Israel resident who operated a grocery store from 2000 to 2006 discovered in May 2025 that his bank account was frozen over an alleged 163,000 shekel municipal tax debt related to the property he once rented. The Gilboa Regional Council, which imposed the freeze, claimed the debt was valid and not time-barred. The former grocer contested this, arguing the debt had expired under the statute of limitations since he had closed the store nearly two decades earlier and had not received any payment demands during that time.

The dispute escalated to the Nazareth-Nof HaGalil District Court, where the grocer, represented by attorneys Wisam Mokhtarn and Amir Atrash, filed a petition in June 2025. The council maintained it had taken multiple collection actions over the years, including warnings, bank garnishments, and attempts to seize movable property, which it said reset the statute of limitations clock. However, the court found that from August 2013 to February 2021, the council had not engaged in meaningful collection efforts, aside from a single recorded phone call in 2018, insufficient to interrupt the limitation period.

Judge Einav Golomb ruled that the municipal tax debt had indeed expired after 19 years without proper enforcement, and therefore the council was not entitled to collect it. The court ordered the cancellation of the account garnishment and required the council to pay the petitioner 10,000 shekels in legal costs. Attorney Mokhtarn emphasized that local authorities must act within the seven-year statutory period to collect debts, warning that failure to do so allows residents to seek judicial relief to annul stale debts and related collection actions.

This ruling highlights the importance of continuous enforcement by municipal bodies to preserve their right to collect taxes and fees, and it sets a precedent for residents disputing old debts that have not been actively pursued.