Altogether, the partial list of tax breaks released by the Ministry of Finance shows that large corporations received NIS 16.5 billion (about $4.7 Billion) in tax breaks in 2006-11. Minister of Finance Yair Lapid is reviewing Israel’s corporate tax break policy following “Globes”‘ successful petition to the courts.
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/ Ela Levy-Weinrib and Chen Ma’anit/
Teva Pharmaceutical Industries Ltd. (NYSE: TEVA; TASE: TEVA) received NIS 11.77 ($3.36 Billion) in tax breaks in 2006-11 under the Law for the Encouragement of Capital Investment (the Ministry of Finance and Israel Tax Authority have not yet provided data for 2012). Teva’s tax break ballooned from NIS 1.29 billion in 2006 to NIS 2.89 billion (about $800 million) in 2012, as “Globes” earlier revealed.
The Ministry of Finance and Tax Authority had claimed at the time, “The figures are not necessarily as reported.”
The Ministry of Finance today disclosed the tax breaks granted to companies under the Law for the Encouragement of Capital Investment, after “Globes'” successful campaign to reduce the astonishing – some would say infuriating – breaks obtained by large companies. The ministry did not disclose the names of private companies which receive tax breaks under the law, pending a hearing by the Supreme Court on the ministry’s appeal against the disclosure.
In response to the disclosure of the tax breaks, Minister of Finance Yair Lapid said that he would review the corporate tax breaks.
Check Point Software Technologies Ltd. (Nasdaq: CHKP) received NIS 1.65 billion ($470 million) in tax breaks in 2006-11, Israel Chemicals Ltd. (TASE: ICL) received NIS 2.2 billion, ($620 million) Elbit Systems Ltd. (Nasdaq: ESLT; TASE: ESLT) received NIS 404.7 million ($116 million) , Oil Refineries Ltd. (TASE:ORL) received a one-time break of NIS 140 million ($40 million) in 2006, and Rafael Advanced Defense Systems Ltd. received NIS 144.7 million ($41.5 million) in tax breaks in 2010-11.
Altogether, the partial list of tax breaks released by the Ministry of Finance shows that large corporations received more than NIS 16.5 billion ($4.71 billion) in tax breaks in 2006-11.
In 2011, three public companies – Teva, Israel Chemicals, and Check Point – and one government company, Rafael, received NIS 3.84 billion ($1.o9 billion) in tax breaks. Teva received 75% of the total. In 2010, five companies, the four above plus Elbit Systems, received NIS 3 billion ($857 million) in tax breaks, of which 75% accrued to Teva.
The list of companies which received tax breaks in 2006-11 includes thousands of other firms, which continue to receive the breaks. The Ministry of Finance did not disclose the amounts.
Minister of Finance Yair Lapid is reviewing Israel’s corporate tax break policy following “Globes”‘ successful petition to the courts to order the Ministry of Finance and Tax Authority to disclose the names of the companies which received tax breaks under the Law for the Encouragement of Capital Investment.
“In view of the ruling in the case ‘Globes’ versus the Tax Authority, and in view of the Supreme Court’s decision, the Tax Authority today gave ‘Globes’ the information in the matter of the companies which received tax breaks in 2006-12 under the Law for the Encouragement of Capital Investment, ” states the Ministry of Finance in a statement. “The tax breaks which were published today were granted in the past under the Law for the Encouragement of Capital Investment, which were approved by the government and the Knesset. These tax breaks are now being reviewed by Minister of Finance Yair Lapid with the objective of updating them and adjusting them to economic needs and reality.”
Published by www.globes-online.com