Strengthening Israeli Business Ties
On 28 March 2019, the Australian Government signed its new Double Tax Agreement with Israel. The treaty will work to generate mutually beneficial investment opportunities and generate bilateral trade for both countries.
The new treaty includes the following key features:
- Reduced withholding tax rates to bring rates in line with other tax treaty countries
- Provisions to reduce potential double taxation on employment income
- Integrity measures regarding the taxation of business profits, including G20 Base Erosion and Profit Shifting (BEPS) measures
- Providing a legal basis for the exchange of taxpayer information between tax officials in the respective countries.
The introduction of the Double Tax Treaty comes at a time when the Australia-Israel defence industry is generating over $1 billion per year of trade between the countries. It is a sensible step forward to encourage further trade, along with the recent Government announcement of the opening of trade and defence offices in West Jerusalem - all pointing to a strengthening of Australia’s economic ties with Israel.