Full coverage· Economy· Updated 00:02

Israel Tax Authority Plans to Raise Mandatory Dividend Payout to 8%

The Israel Tax Authority plans to raise the mandatory dividend payout for companies from 6% to 8%, a move expected to generate an additional 1-2 billion shekels annually. This decision goes against the business sector's demands to ease or abolish the "trapped profits" reform set for 2025.

2 newsrooms · 2 languages · since 10 Nov, 05:58

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Israel Tax Authority Plans to Raise Mandatory Dividend Payout to 8% — Illustration by baba

What happened

01Israel Tax Authority plans to raise mandatory dividend payout for companies from 6% to 8%.
02The move aims to generate an additional 1-2 billion shekels annually for the state treasury.
03The decision contradicts demands from the business sector to ease or abolish the "trapped profits" reform.
04Business leaders warn the increase will deplete company investment funds and harm economic growth.
05The "trapped profits" reform is scheduled to take effect in early 2025.
06The Tax Authority head cited insufficient state liquidity as the reason for the proposed increase.

Business leaders and tax experts warn the change will harm investment and economic growth, while the Tax Authority head cites the need for state liquidity.

Translated and summarized by baba from Alarab, the latest report. Read Alarab’s original