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July 25, 2016 / 19 Tammuz, 5776

Posts Tagged ‘Tax Authority’

Smuggled Rocket/Mortar Parts Shipment From Hebron to Gaza Foiled

Thursday, May 26th, 2016

A recent joint operation by Israeli military, police, customs and tax officials and Shin Bet intelligence agents has turned up a massive shipment of military parts headed for Gaza from Hebron. It is also now clear there is a Hamas manufacturing facility in the ancient Judean city.

Terrorists were caught red-handed with contraband – weaponry parts – at the Tarqumiya crossing near Hebron with a large shipment headed for the Kerem Shalom crossing into Gaza.

Intercepted pipes for rockets and mortars

The shipment was listed as textiles and jewelry, and was huge, according to a statement by security officials.

But hidden among the goods were a lot of electric motors that are useful for building tunnels – attack tunnels – and special cuttings for mortars and rockets.

Intercepted electric motors for tunnels

Gaza’s ruling Hamas terrorist organization has, in fact, a manufacturing and distribution center set up in Hebron, with a plant there to produce parts for its war machine.

Imagine what might have happened, if the Tarqumiya checkpoint no longer existed?

Or if the Kerem Shalom crossing were simply wide open, as Turkey continues to demand?

Hana Levi Julian

Israel, U.S. Reach Agreement on IRS Regs for Dual Citizens

Thursday, May 15th, 2014

Americans living in Israel, watch out for this year’s June 30 tax deadline.

The Israel Tax Authority has formally reached an agreement with the U.S. regarding the Model 1 FATCA agreement with the IRS, according to attorney Dave Wolf, of the firm Hacohen and Wolf.

The full details of the FATCA Agreement are yet to be published upon the signing of the FATCA Agreement, but according to the Israel Tax Authority’s spokesman, the agreement contains certain restrictions on the use of information passed to the IRS and relief of reporting for certain institutions.

According to U.S. law, all U.S. citizens — regardless where they live — have an obligation to pay taxes on their worldwide income. In addition, in cases where the aggregate value of all foreign accounts exceeds $10,000 at any time during the calendar year, they also have to report this information on a special form commonly known as the FBAR.

Since July 1, 2013, the FBAR needs to be e-filed before June 30 of the following tax year.

Under FATCA, foreign financial institutions (banks, hedge funds, pension funds, insurance companies etc.) are required to report information to the U.S. tax authorities (the IRS) information about foreign accounts held by U.S. taxpayers, or by foreign entities in which U.S. taxpayers hold a substantial ownership interest.

This means the Israeli financial institutions will have to report to the U.S. government all their clients who are U.S. citizens and/or green card holders, disclosing all these accounts.

This has huge implications for any American living in Israel or abroad who has never reported his foreign accounts or paid taxes on its income to the IRS, and also to some states if applicable (such as NY and NJ).

Individuals have four options with which to comply, according to Wolf, who can be reached at this link for more information.

Jewish Press Staff Reporter

Israeli Tax Authority Kills the Next Great Startup

Tuesday, December 24th, 2013

An innovative Israeli start-up company came up with a great idea in 2010, which it dubbed GetTaxi. The idea is simple and convenient: the GetTaxi mobile app allows you to order a taxi, pay for the ride, rate the driver, and even leave a tip. For the drivers, it offer the convenience of automation, handling the billing, and notifying drivers of potential nearby clients.

This start-up has been so successful, it has reached a million users, making 20,000 orders a day to 6000 drivers, in 20 cities, not to mention, raising $42 million in funding.

But the Israeli tax authority may have just killed this enterprising young start-up.

Last week, the tax authority concluded its investigation of 89 businesses in various sectors. A team of 102 investigators managed to collect about $2.2 million from these businesses, which had under-reported their income.

One sector the team investigated were taxi drivers, traditionally a cash business. But the tax folks had a great idea. They subpoenaed GetTaxi’s internal files, obtaining the records of some three thousand Israeli taxi drivers who used the GetTaxi service. The team then targeted 50 of them, according to a report in Globes.

They compared the orders listed in GetTaxi, and the income the taxi drivers reported, and found that most of the drivers had not recorded all their journeys.

Most of the drivers ended up with a simple fine, some of the more serious cases are undergoing further investigation.

Tax Authority chief Moshe Asher told Globes, “The Tax Authority is keeping its finger on the trigger and uses all technological means to make certain that all citizens and companies pay the true amount of tax and do not put the tax burden on law-abiding citizens.”

In the process, the same tax authority possibly just destroyed a law-abiding start-up company, which had a promising future.

Its unlikely Israeli taxi drivers will continue to completely trust GetTaxi with their business, and that could affect not only GetTaxi’s revenue, but even a future exit or IPO, potentially killing the goose that could have laid the golden income tax egg GetTaxi would have brought in.

But Israelis are a resourceful people. We’ll have to see how each side responds to this challenge.

Not to worry though, in New York and other major cities, the company continues to do well, and the Israeli tax authority is not likely to have a chilling effect on its operation. The IRS is simply less fiercely dedicated than its Israeli counterpart.

True story: A few years ago, a falafel booth owner was approached by a man from a yeshiva, who inquired if Shlomi were willing to donate to the yeshiva the edges from the pita he cuts off when he makes each falafel sandwich? It would feed poor students, the man explained, and help cut back on the yeshiva’s costs.

Shlomi agreed. It’s a good deed, and he had nothing to do with all those pita edges other than dump them in the trash. How many garlic bread crisps could he possibly make anyway?

A few months later, Shlomi and other falafel and shawarma (meat gyro) vendors found themselves inside the offices of Mas Hachnasa, the Israeli income tax authority.

They were surprised to see, sitting opposite them, the man from the yeshiva to which they had all been donating their pita edges, supposedly.

They were even more surprised with the man pulled out all the pita edges the vendors had donated to him, and said the number of edges that he, a tax investigator collected, exceeded the number of individual portions they had reported.

Needless to say, falafel and shawarma stores in Israel today slit the pita open, rather than cut off the top. There’s no evidence left behind that way.

Shalom Bear

Printed from: http://www.jewishpress.com/news/breaking-news/israeli-tax-authority-kills-the-next-great-startup/2013/12/24/

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