Sheshinski cuts Tamar's value 60%

The calculations are based on a model assuming company tax of 18% and a maximum new tax of 60%.

The new tax model proposed by the interim recommendations of the Sheshinski Committee will lower the value of the Tamar gas field by 60% according to calculations attached to the committee's report. The calculation is based on data from very similar fields to Tamar with similar quantities of gas, prices and costs of exploration.

According to the calculations, if the tax model is implemented, the net value of Tamar will fall from about NIS 23 billion to NIS 9.15 billion. The model assumes company tax of 18% and a maximum new tax of 60%.

The public hearing will continue until the end of next month. The final recommendations of the Sheshinski Committee will be submitted after the public hearing to a Ministry of Finance committee and then for government approval.

Minister of Finance Yuval Steintiz said today that he expects the final report to contain changes from the interim recommendations as a result of matters brought up at the public hearing.

Steinitz said, "If anyone thinks its difficult and he doesn't want to invest here we won't keep him here by force. There are many companies in the world looking to take their place."

Published by Globes, Israel business news - www.globes-online.com - on November 16, 2010

© Copyright of Globes Publisher Itonut (1983) Ltd. 2010

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