The question of differentiating between an employee and an independent (self-employed) person has always been of primary importance in Israeli Income Tax law as a result of the various rules that distinguish these two types of assessees. In light of the adoption of the Ben-Shahar Commission's recommendations, this distinction has acquired even greater importance, as shall be explained.
This article discusses the law as it stands at present, which is not to say that in our view the current law is ideal. On the contrary, it is our opinion that the distinctions between the employed assessee—employee— and the independent assessee—self-employed—ought to be abolished. However since Israeli law does draw such distinctions at present, we shall discuss what is, de lege lata, and leave the discussion de lege ferenda for another time.