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Israel: Aid Measures for Third-Sector Organizations and Civil Society

As part of its effort to deal with the coronavirus crisis, the Social Services Division of the Accountant General’s Department at the Israeli Ministry of Finance recently released an aid package for the benefit of third-sector organizations (Amutot and public benefit companies) and civil society.


The following are the highlights of the published steps:


Grants to businesses and non-profits totalling NIS 5.2 billion


In accordance with the Israeli government’s decision, an aid plan was approved, under which a dedicated grant of up to NIS 400,000 will be given to each Amutah significantly affected by the crisis and whose annual turnover does not exceed NIS 20 million. An Amutah must meet certain threshold conditions for receiving the grant, including its classification as a ‘public institution’ (according to the Income Tax Ordinance) and other conditions regarding the Amutah’s financial sources.


A NIS 8 billion state-guaranteed loan assistance fund


In accordance with the plan, small Amutot will receive loans from banks, with state guarantees and low interest rates, for a sum not exceeding 16% of their annual turnover (and for medium-sized Amutot, not exceeding 8% of their annual turnover). The amount of each loan shall not exceed NIS 20 million. The loan will be provided under enhanced collateral terms, for a period of up to 60 months. In addition, the loan may be granted a 12-month grace period, where the interest accrued during the first year will be subsidized by the state.


Benefits on city tax, electricity, and water payments


The government is seeking to apply all reliefs provided to the business sector with regard to city tax, electricity, and water payments also to third-sector organizations (regardless of how they are incorporated).


Support measures


In this context, it was decided, among other things, to approve cash advances (at the expense of support money for activities that were or will be carried out in 2020) in a total amount of about NIS 1 billion. This money has already been transferred to more than two thousand public institutions supported by the state budget. It was also decided to freeze the audits of public institutions supported by the state budget (as well as to provide an extension for filing documents). This, in order to facilitate their operations at this time. In addition, existing procedures and regulations were adjusted to allow the continued support of such institutions in the future. These adjustments pertain to the required self-financing rate, the maximum management and general expenses rate, the maximum deficit, and reliefs during bureaucratic proceedings.

Tags: Coronavirus | NPO