Israeli Lawmakers Approve Tax Cut On Foreign Securities
The Knesset Finance Committee has approved new legislation regarding the taxation
of foreign securities, meaning than from January 1 2005, they will receive the
same tax treatment as Israeli securities.
The new tax legislation will mean that capital gains and interest tax on foreign
securities listed on the Tel Aviv Stock Exchange will be cut to 15% from 25%,
bringing them into line with domestic listed investments. The measure was initially scheduled to come into effect in January 2007, but
the proposals have been accelerated at the request of the government, by splitting them off from a larger income tax authority bill. However, discussions have failed to resolve a dispute that has emerged
between the banking sector and the government concerning the deductibility of
losses accrued in 2003 and 2004. The second and third Knesset readings of the amendment are likely to be held
next week. .
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