Category Taxation in Israel

New Mining Tax in Israel

October 21, 2014 Taxation in Israel

JERUSALEM – Mining companies in Israel may see as much as half of their incomes taxed away, if the suggestions raised by a government committee are approved.

On October 20th the government appointed Sheshinski Committee issued a new report proposing changes to the taxation of profits earned from mining activities in Israel, suggesting that a new progressive tax of between 25 percent and 42 percent on profits.

The tax was recommend to be charged at a rate of 25 percent after the activities of the company reach an annual return on investment of 14 percent, rising to a maximum rate of 42 percent when profits rise enough to attain a return on investment of 20 percent or higher.

The currently active royalty rate will be set at a uniform rate of 5 percent, compared to the current variable rat...

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New Taxes On Extraction of Resources in Israel

May 19, 2014 Taxation in Israel

JERUSALEM – Business extracting mineral resources in Israel could soon pay a new windfall tax, and a resource royalty, while facing greater scrutiny of their tax affairs.

On May 18th a government appointed committee, established to examine potential changes to the taxation of natural resources, issued an interim report recommending a thorough revamp of the taxation of extraction operations, a move which could raise as much as ILS 500 million per year of new tax revenues.

In the report the experts of the committee called for a new windfall tax of 42 percent to be paid by any business involved in the extraction of any natural resource in Israel, in addition to the standard corporate income tax.

The committee also called for the royalty on the extraction of any natural resources to be set at...

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Israel Doubles Tax on Empty Properties

December 10, 2013 Taxation in Israel

JERUSALEM – In a move aimed at easing the conditions on the housing market in Israel, the government has doubled the property taxes levied on more than 47 000 properties in the country.

On December 9th the Knesset’s Finance Committee approved a new legislative bill doubling the property taxes levied on unoccupied residential properties and on second homes which are not regularly used by the owners.

The increased tax will apply to any residential property which has been unoccupied for a period of more than nine months, regardless of whether it is a holiday home or an investment property, or whether the owner is a resident of Israel or an overseas citizen.

The government currently estimates that approximately 47 000 properties are currently classified as unoccupied, 20 percent of which are i...

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Tax Raids Held in Israel

November 19, 2013 Taxation In AsiaTaxation in Israel

Jerusalem propertyJERUSALEM – Several hundred homes have been raided by tax authorities across Israel, in an effort to find tax evading property owners who don’t declare rental incomes.

Over the weekend the Tax Authority of Israel revealed that several raids and investigations were conducted by tax inspectors last week on affluent homes across the country in an effort to uncover evidence of tax evasion, especially instances of overseas-based landlords not reporting the rental incomes received from high-end properties.

Two separate raids were initially carried out on pre-selected homes in Tel Aviv and Herzliya Pituach, and several days later a further raid occurred in Ashdod.

According to the Tax Authority, over the course of the last raid, 200 homes were visited with specific requests for the occupier to ...

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Tax Break Pays Off in Israel

November 14, 2013 Taxation In AsiaTaxation in Israel

Tax in IsraelJERUSALEM – A new program by the tax authority in Israel has yielded significantly positive results, leading to billions being invested into the economy and paid out in taxes.

On November 13th the Tax Authority of Israel announced that more than NIS 4.37 billion has been collected from large businesses as part of a new profit repatriation program aimed at addressing the problem of “trapped profits”.

The program is intended to provide an incentive to large companies from Israel to bring back funds and retained earnings held in overseas accounts.
Businesses which agree to repatriate profits will pay a tax rate of between 6 and 10 percent on the amount, compared to a standard rate of 25 percent.

In order to take advantage of the program, over the next five years businesses are required to...

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