UK daily "The Guardian" names Israelis among British and foreign nationals who are exploiting tax loopholes and the offshore secrecy offered by the British Virgin Islands to buy billions of pounds of property in the UK, especially in central London, including £7 billion in 2011 alone.
"The Guardian" says, "Some wealthy Israelis have also traded heavily in tax-free UK property behind the offshore screen. The art collector Joseph Hackmey, heir to an insurance business in Israel, moved to Kensington Palace Gardens in London, and set up more than 20 British Virgin Islands companies with names such as Frentforth, Breezeknoll and Solsdeck."
The newspaper also names Adv. Yoram Yossifoff, who has been involved in more than £1 billion of London property deals. The paper calls him "an expert in what he calls 'creative tax planning', Yossifoff not only speculates on his own behalf, but, with his Tel Aviv-based Mydas Investment Fund Ltd. (TASE:MYDS), fronts deals for consortia of other Israeli investors."
"The Guardian quotes a source familiar with Yossifoff's transactions as saying, "The exemption from capital gains tax formed part of policies promoted by the [UK] government of the day to encourage inward investment." Yossifoff, Cohen, Koren, Grodberg & Co. law firm, represents clients in litigation, but his main business is real estate. His biography on the firm's website says, "In the past ten years, Mr. Yossifoff has divided his time between Israel and the UK, where he also acts as an independent businessman and entrepreneur. As part of his activities in the United Kingdom, Mr. Yossifoff has been involved in real estate purchase and investment transactions in strategic locations in central cities, such as London and Manchester, in an aggregate value of approximately £1 billion." "The Guardian's" mention of Yossifoff's name is not the first time that it has come up with regard to tax issues. In May 2010, the Israel Tax Authority investigated allegations that Yossifoff and Ronnie Mana evaded taxes. The investigation focused on the attempted acquisition by Arcadi Gaydamak of the controlling interest in Gal-On Investments Ltd. Mana demanded a NIS 4.2 million broker's fee, even though the deal was never closed, and later sued Gaydamak for the payment. The Tax Authority suspected that Mana and Yossifoff bought shares in Gal-On, and sold them a few days later for a gain of NIS 2 million. They reported the gain as a capital on which they paid a 20% tax rate; the Tax Authority held that the gain was actually a broker's fee on which a much higher tax rate should have been paid.
Published by Globes [online], Israel business news - www.globes-online.com - on November 27, 2012
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