Israel Chemicals Ltd. estimates the financial damage to the company from the recommendations of the government appointed committee on taxation and royalty policy for natural resources will be over $2 billion. ICL CEO Stefan Borgas told the committee members on Aug. 4 that the figure is based on $150 million a year in increased costs over a 14 year period.
Borgas also said that ICL would move its activity abroad and the company has already halted $750 million in investments in Israel as a result of the preliminary recommendations. He called Israel a country that was difficult to invest in because of the frequent regulatory changes.
In May the committee recommended imposing a 42 percent windfall tax on profits and a uniform royalty on all natural resources (excluding oil and gas) of 5 percent.
The interim report recommended that the new tax regime come into effect in 2017, and not when the legislative process is concluded by the Knesset. The report said this could give ICL time to adjust to the proposed changes. A final committee report is due out in a few months and this will be followed by government approval and then passage of a law by the Knesset.