preface

BDO Israel
7.2.2.4. Approval Procedure
DOING BUSINESS IN ISRAEL
As aforementioned, the law includes two principal schemes for
obtaining tax concessions: one is the grants program, and the
other - the benefits program. To obtain the status of “Approved
Enterprise” under the grants program, a company is required to
submit a plan to the Investments Center.
The Investment Center Management is authorized to approve
applications received during the relevant budget year in the
context of the current or the previous year's budget.
Lately, pursuant to the comprehensive amendment of the Law,
the terms for obtaining concessions were stipulated both in
respect of grants as well as tax benefits. Consequently, the
procedures for granting the status of "approved enterprise"
differ. Whereas an enterprise applying for grants will be
required to submit a plan to the Investments Center, this will not
be required of an enterprise wishing to benefit from tax
concessions under the status of "preferable enterprise". If the
enterprise complies with the threshold conditions stipulated by
law, it could enjoy these tax benefits and claim them under the
income tax returns it files.
The determination by either the Investment Center or the tax
authorities as to whether an enterprise is an "industrial
enterprise" is binding upon both bodies for a 5-year period,
unless substantial changes are introduced or erroneous reporting
has been discovered in the enterprise.
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