Israel tax chief gave evidence on "Milchan Law"

Arnon Milchan and the Netanyahus Photo: Avi Hayon GPO

Moshe Asher wants to repeal the law, which police allege was enacted by Benjamin Netanyahu's government to give tax exemption to Arnon Milchan.

Israel Tax Authority head Moshe Asher gave evidence to the police in one of the investigations against Prime Minister Benjamin Netanyahu, sources inform "Globes." His evidence concerned Asher's repeated attempts to eliminate the tax benefits and exemptions for returning residents and new immigrants in legislation being referred to as the "Milchan Law," a bill that was enacted in 2008, and which constitutes the heart of the investigation referred to as "Case 1000."

The police suspicions against the prime minister, revealed yesterday for the first time, are that he worked on behalf of the enactment of the law, which grants extraordinary tax benefits and an exemption from reporting assets to among others businessperson Arnon Milchan. The witness providing grounds for the suspicions in the matter is former Minister of Finance and MK Yair Lapid (Yesh Atid), who told the police that when he was minister of finance, he did not agree with the Milchan Law, but that Netanyahu had pressed for it. "Netanyahu told me to pass this bill," Lapid told the police.

In the framework of probing the legislative processes and the personalities involved in promoting the legislation, the police also questioned Asher, who since being appointed to his position has repeatedly tried to have the legislation repealed. Asher, who is resigning next month, was supported by both Lapid and current Minister of Finance Moshe Kahlon, but to no avail.

Asher included a clause eliminating the exemption for new immigrants in the proposed 2013 Economic Arrangements bill, including the clause making it possible to extend the exemption beyond 10 years through regulation, but encountered vigorous opposition from the Ministry of Immigration and Absorption, headed by then-Minister of Immigration and Absorption Zeev Elkin. Later, the Tax Authority administration included a similar clause in the next Economic Arrangements bill, but early elections in 2015 disrupted these plans. The proposed Economic Arrangements bill for 2017-2018 also included a proposal to cancel the benefits for new immigrants altogether, but although the matter was brought up in preliminary discussions about the bill, the revised bill, published on October 31, 2016, did not address the question of benefits for new immigrants.

Asher repeatedly encountered open opposition from the Ministry of Immigrant Absorption, headed first by Elkin and later by Minister of Immigrant Absorption Sofa Landver (Yisrael Beitenu), and also covert opposition. Although the Ministry of Finance supported canceling the benefits, canceling them appeared to be impossible.

Asher also attempted to repeal the benefits in the Economic Arrangements bill for 2019, but the bill was again assigned to a separate legislative track.

Asher declined to respond to the report.

Published by Globes [online], Israel Business News - www.globes-online.com - on February 14, 2018

© Copyright of Globes Publisher Itonut (1983) Ltd. 2018

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Arnon Milchan and the Netanyahus Photo: Avi Hayon GPO
Arnon Milchan and the Netanyahus Photo: Avi Hayon GPO
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