Municipal authorities provide public services to their residents, and are authorized to collect municipal taxes in order to finance those activities. The primary tax is the municipal “Arnona.
Arnona is imposed on structures, not on lots. In this context, there is a symmetry existing between the payment of property tax and the payment of municipal Arnona; as long as no structure is built on the lot, its owner must pay Property Tax. As soon as a building is built on the lot, municipal Arnona must be paid
The resident of the dwelling, who is the beneficiary of the local authoritys services, is the one liable for payment of Arnona. Therefore, for a rented property, the party who is paying the rent will be charged for the payment of Arnona. However, the owner is responsible for notifying the local authorities that the property is rented, and for providing them with the identity of the rent-paying tenant.
When there is a change of tenants, the departing tenant is responsible for notifying the authorities of the change and for providing the identity of the new tenant. If this is not done, he/she could find him/herself liable for the payment of the municipal Arnona in the event that the new tenant evades the obligation to pay
If Arnona is not paid, the local authorities will not provide authorization to transfer property rights in the Land Registry Office. Therefore, the buyer must verify that the seller has made the payments as discussed above.