For the purpose of the judgment here - which does not deal with spouses but with minors - there is no need for a detailed description of the development of the case law (and those who are interested can find the matter in detail there, in the Blank case).
I will suffice with a summary of the matter (see paragraph 17 of the Blank case):
- The rule - the presumption of the family unit: The members of the family unit - spouses and their minor children, shall be regarded as a single unit, with regard to entitlement to an exemption from betterment tax and purchase tax relief granted to a qualifying residential apartment and a single residential apartment (respectively).
- Exceptions established in the law: The legislature established three cases in respect of which the presumption of the family unit will not apply:
- In relation to spouses: when the couple lives permanently separately;
- With respect to minor children: a. When the minor marries; b. When the minor is an orphan (added to the law under Amendment 103 to the Law).
- Exceptions set out in the case law, which related to spouses:
- The exception to the historical charge: the actions taken by one of the spouses prior to the establishment of the family unit are not taken into account in order to deny tax relief to the other spouse [see: Misna Appeal (Be'er Sheva) 2979/97 Mor v. Be'er Sheva Land Appreciation Tax Administration [Nevo] (July 15, 1998); Civil Appeal 3185/03 Central Land Appreciation Tax Administration v. Flam [Nevo] (August 19, 2004)].
- The property separation exception: The presumption of the family unit is not an absolute presumption but rather a rebuttable presumption, and therefore the presumption will not apply if the couple has established a property separation between them in a prenuptial agreement and the separation is implemented in practice [Civil Appeal 3178/12 Shalmi v. Netanya Land Taxation Administration [Nevo] (November 17, 2014) (hereinafter: "the Shlomi case")]. In the judgment in the Blank case, it was determined that a separation of property between spouses will be recognized, even if the couple lives together in an apartment that belongs to only one of them in accordance with the prenuptial agreement.
- The imposition of purchase tax upon the purchase of an apartment by a minor was discussed by the appeals committees in two judgments: Appeals Committee (Tel Aviv) 1393/01 Ibn Ezra v. Netanya Betterment Tax [Nevo] (June 29, 2003) (hereinafter: "the Ibn Ezra case"); and after a number of years inthe Appeals Committee (Tel Aviv) 62431-06-15 Hagag v. Tel Aviv Real Estate Taxation Administration [Nevo] (April 27, 2017) (hereinafter: "the Hagag case").
In both judgments, we were dealing with a minor for whom a residential apartment was purchased, and the question that arose was whether, even though his parents have a residential apartment, the minor's apartment should be regarded as a single apartment, or not. In the Ibn Ezra case, we were talking about an apartment that was purchased by the grandfather, and in the Hagag case, we were talking about an apartment whose purchase was apparently financed by the parents.