Last week, Globes revealed that Zim is demanding exorbitant tax benefits from the tax authority, now the main shareholder in the company, Idan Ofer, is making it clear that he has nothing to do with the request.
A statement sent to the media stated: “I am not involved in Zim’s request regarding a change in the tax regime regarding it, if there was indeed such an application. If I were asked in my opinion I would suggest that Zim not apply for a change in the tax regime regarding it.”
Demanded a dramatic drop in the volume of taxes
Zim became the most profitable company in Israel this year and for the first time began to pay tax. So far the company has not paid tax because it has had accumulated losses. Last week, it was revealed in Globes that the company turned to the tax authority and asked for dramatic changes in the tax regime that would save it hundreds of millions of shekels. Thus, company officials conveyed to the Treasury representatives a “message” that if the state does not adopt “occupancy tax” legislation, which is already practiced in many countries and calculates the amount of tax according to ship occupancy and not according to company profits, it will transfer its activities to another country.
According to the occupancy tax method, the taxable income of the shipping company is calculated according to the occupancy of the vessel that the company operates (how many tons the ships can carry). This is instead of corporate tax, which currently stands at 25%, and in the past also stood at about 30%. While corporation tax refers to the profitability of the company, occupancy tax refers to the size and content of the company’s ships. Many countries around the world adopted the occupancy tax system 15 and 20 years ago, including EU countries, but in Israel, although discussions have taken place on the subject, they have not been formulated into legislation.
It is difficult to estimate how much tax ZIM will pay if an occupancy tax is applied in Israel, since it is not clear what model will be adopted. But even in rough calculations according to the law memoranda that were previously placed on the Knesset table, there is a dramatic drop in tax liability – from hundreds of millions of shekels to only tens of millions.