Kiryat Shmona petitions High Court to extend war compensation for businesses struggling to recover

Kiryat Shmona Municipality has petitioned the High Court of Justice to extend the period covered by war compensation for local businesses, arguing that the state stopped recognizing their losses while the city was still struggling to recover from evacuation.In a November 4 decision, Justice Ruth Ronnen ordered the government and the other respondents to submit a preliminary response by January 4, 2027. The decision did not rule on the municipality's claims or grant compensation.The petition challenges the end of eligibility under the “red track,” which compensates qualifying border-community businesses for proven losses, from March 1, 2025, and the June 30, 2025 cutoff for additional temporary compensation arrangements.The municipality argues that allowing residents to return did not restore the customers, workers, and income businesses depended on. It is also seeking a special arrangement to repay compensation advances that businesses had already spent on wages, suppliers, and recovery.Kiryat Shmona demands extended war compensation as local businesses struggleBefore the petition was filed, the Tax Authority rejected the municipality's demand. In a letter dated September 24, Amir Dahan, director of the Tax Authority's Compensation Fund, said eligibility under the red track depended on the applicable legal conditions - including a shutdown caused by military restrictions - rather than whether the government had formally declared the war over.The municipality is asking the court to require…