preface

BDO Israel
DOING BUSINESS IN ISRAEL
the new tax track from 2011, provided the authorities are notified
accordingly in the context of the 2010 fiscal report.
Grants Program
7.2.2.2. General
• Pursuant to the 2011 Amendment, the stipulation prohibiting
multiple benefits (tax track and grants track) has been
withdrawn. As such, industrial enterprises complying with
the required export conditions may benefit simlutaneously
from both the grants as well as the tax benefits track, as
discussed earlier. Notwithstanding the above, should export
conditions apply to revenue deemed as an "expansion" of
previous activity, the enterprise may still benefit from the
grants track even though the tax benefits will not apply.
Eligibility for investment grants will be limited only to
industrial enterprises located in Priority Area A. The grants
program is limited to the budget framework approved
annually for this track under the budget law.
• Approved Enterprises are entitled to grants of up to 24 % of
tangible fixed assets. Nevertheless, the 2011 Amendment
framework prescribes that approval of the grants will not be
limited solely to investments in fixed assets but will also
include investments in human resources and other ventures,
provided these are in line with the defined targets.
Furthermore, the Investment Center Management will be
authorized to grant State-guaranteed loans.
7.2.2.3. The Main Conditions
The government provides grants as participation in financing the
purchase of tangible fixed assets. The grants vary - depending on
the type of enterprise and the National Priority Region.
The amount of the grant is calculated as a percentage of the
original cost of land development and investment in buildings,
machinery, and equipment. Machinery and equipment must be
new, or used imported machinery and equipment not previously
applied in Israel, provided the Investment Center Board had
approved them.
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