The State of Israel will receive tax of at least NIS 1 billion as a result of the deal for the sale of the Wertheimer family's remaining 20% stake in Iscar to Warren Buffett's Berkshire Hathaway, according to estimates by sources in the Tax Authority.
"This will save some of the planned austerity measures that would have hit the middle classes," one source said.
Berkshire Hathaway will pay $2.05 billion for the 20% of Iscar it does not already own. Buffett's company bought 80% of Iscar in 2006 for $4 billion.
The tax receipt on the deal will help the Ministry of Finance to cope with the huge fiscal deficit and will go some way to alleviating the burden on the public.
A further effect on the macro level will be on the foreign exchange market: sources estimate that the shekel will strengthen with the conversion of the dollar sale proceeds to local currency.
Published by Globes [online], Israel business news - www.globes-online.com - on May 1, 2013
© Copyright of Globes Publisher Itonut (1983) Ltd. 2013