Sources inform ''Globes'' that Renault president and CEO Carlos Ghosn is expected to come to Israel to attend the dedication ceremony for the Project Better Place electric car venture initiated by Shay Agassi and Israel Corp. (TASE: ILCO). The ceremony is scheduled for January 21 at the President's Residence in Jerusalem. Minister of Finance Ronnie Bar-On and business leaders are expected to attend, and possibly Prime Minister Ehud Olmert as well.
The Renault Nissan Alliance of Renault SA (Euronext:RNO) and Nissan Motor Co. Ltd. (TSE:7201) is expected to participate in the technical development of the electric car, at an estimated investment of $150-300 million. The electric car will not be manufactured in Israel, however.
The Green Tax Committee yesterday recommended that the purchase tax on zero-emission cars - mainly electric cars - should be only 10%, compared with the 78% tax on regular cars. Zero-emission cars will be eligible for a NIS 400 tax break on the value use of company cars. The government also promised not to cut the purchase tax on gasoline and diesel cars below 60%, which will preserve a minimal margin on tax brackets.
The benefit, if the government approves it, will be valid through the end of 2014, on the assumption that this is enough protection for an emerging industry. The Green Tax Committee nevertheless recommended that if the market share for electric cars exceeds 20%, a revised benefits package should be submitted to the government to reflect the changed circumstances.
The Green Tax Committee also recommends taxing the electricity used to recharge the batteries of electric cars so that the tax rate per kilometer of travel will equal the excise on gasoline and diesel. The cabinet is expected to approve the recommendations at next Sunday's meeting.
Published by Globes [online], Israel business news - www.globes-online.com - on January 10, 2008
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