A few facts on why to invest in Israel, especially in these days
A few facts on why to invest in Israel, especially in these days
Israel encourages both local and foreign investment by offering a wide range of incentives and benefits to investors in industry, tourism and real estate. Special emphasis is given to hi-tech companies and R&D activities.
Investment incentives are outlined in the Law for the Encouragement of Capital Investment which was recently revised. The new Law differs from the previous one in that it adds a new path for incentives - an automatic one. The incentive
programs can be divided into 2 main types: 1) The Grants program - administered by the Israel Investment Center (IIC), a department of the Ministry of Industry, Trade and Labor 2) The Automatic Tax Benefits program administered by the Tax Authorities.
To qualify, investment projects must meet certain criteria including: international competitiveness, minimal designated investment, high added value and registration of the company in Israel.
Once these criteria are met the enterprise gains Approved Enterprise status from the IIC if it chooses the grants program and Beneficiary Enterprise status by the Tax Authority if it chooses one of the tax benefits programs. It is then eligible for incentives, such as grants of up to 24% of tangible fixed assets (grants program only) and/or reduced tax rates, tax exemptions and other tax related benefits.
Tax Benefits: Grant Program Companies choosing the grant program receive tax benefits as well for a period of 7 consecutive years, starting with the first year in which the company earns taxable income (grants are not considered
income). Tax benefits are determined by the percentage of foreign control: the more foreign control in the
enterprise, the higher the benefits.
If at least 25% of an Approved Enterprise's owners are foreign investors, the enterprise is eligible for a 10 year period of tax benefits*.
Strategic program: This program is intended mainly for large multi-national companies meeting the following criteria: an annual turnover of at least $3 billion and a minimum investment of $130 million in the project itself.
Location: Priority Area A Benefits include: a. Corporate tax – 0% (i.e. complete tax exemption) b. Dividend tax – 0%
c. Benefit period – 10 years
Israel encourages both local and foreign investment by offering a wide range of incentives and benefits to investors in industry, tourism and real estate. Special emphasis is given to hi-tech companies and R&D activities.
Investment incentives are outlined in the Law for the Encouragement of Capital Investment which was recently revised. The new Law differs from the previous one in that it adds a new path for incentives - an automatic one. The incentive
programs can be divided into 2 main types: 1) The Grants program - administered by the Israel Investment Center (IIC), a department of the Ministry of Industry, Trade and Labor 2) The Automatic Tax Benefits program administered by the Tax Authorities.
To qualify, investment projects must meet certain criteria including: international competitiveness, minimal designated investment, high added value and registration of the company in Israel.
Once these criteria are met the enterprise gains Approved Enterprise status from the IIC if it chooses the grants program and Beneficiary Enterprise status by the Tax Authority if it chooses one of the tax benefits programs. It is then eligible for incentives, such as grants of up to 24% of tangible fixed assets (grants program only) and/or reduced tax rates, tax exemptions and other tax related benefits.
Tax Benefits: Grant Program Companies choosing the grant program receive tax benefits as well for a period of 7 consecutive years, starting with the first year in which the company earns taxable income (grants are not considered
income). Tax benefits are determined by the percentage of foreign control: the more foreign control in the
enterprise, the higher the benefits.
If at least 25% of an Approved Enterprise's owners are foreign investors, the enterprise is eligible for a 10 year period of tax benefits*.
Strategic program: This program is intended mainly for large multi-national companies meeting the following criteria: an annual turnover of at least $3 billion and a minimum investment of $130 million in the project itself.
Location: Priority Area A Benefits include: a. Corporate tax – 0% (i.e. complete tax exemption) b. Dividend tax – 0%
c. Benefit period – 10 years
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