Several hours before tonight's midnight deadline, Teva Pharmaceutical Industries Ltd. (NYSE: TEVA; TASE: TEVA) has reached an agreement with the Israel Tax Authority to pay NIS 2.540 billion ($718 million) for the release of trapped profits, and settle tax assessments for the years 2005-2007. Similar principles will apply through 2011.
In total, Teva will pay NIS 2 billion ($565 million) as part of amendment 69 to the Law for the Encouragement of Capital Investments (the "Trapped Profits Law”). This includes the payment of NIS 336M ($95 million) made in May 2013. Teva will pay a further NIS 840M ($237 million) for tax assessments for the year 2005-2011.
Teva expects to incur a charge of about $235 million to be reported in the fourth quarter of 2013, which will be reflected in its non-GAAP results.
Teva acting president and CEO Eyal Desheh said, “We have reached a beneficial agreement for Teva and the Israel Tax Authority concerning the release of trapped profits and the closure of pending tax assessments. The agreement generates sources for dividends to our shareholders for years to come and settles tax assessments which had been in dispute for a long time."
Published by Globes [online], Israel business news - www.globes-online.com - on November 11, 2013
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