In March 2006, Tax Commissioner Jacky Matza approved a tax compromise with Shari Arison. Following his ruling, the billionaire heiress paid the Tax Authority NIS 400 million.
The arrangement was reached after four years of grueling negotiations, over how much tax Arison should pay the Tax Authority for selling shares in Carnival Cruise.
When the story began, she claimed to owe no tax in Israel whatsoever. The commissioner at the time, Tali Yaron-Eldar, accepted a compromise under which Arison would pay a few million shekels. But the lash of public criticism froze the deal in its tracks.
Then there was another controversial agreement involving Yaron-Eldar and Matza himself, then the deputy commissioner of investigations. The arrangement in question was with The Israel Phoenix Assurance Company.
In September 2003 tax investigators raided the insurance company headquarters, seeking documents to back suspicions that it had dodged some NIS 20 million in tax. The headlines wailed and shrieked.
That affair ultimately resulted in headlines along the lines of "Storm in teacup dies down". Phoenix denied all but preferred to compromise, to minimize the damage being wreaked on its image. It paid NIS 2.5 million in fines and NIS 4.5 million in tax and that was that.
People operating on Phoenix's behalf included lawyers Pini Rubin and Moshe Drucker, and accountant Reuven Schiff. Buds of the arrangement started to show a few days before it was made public, when Yaron-Eldar participated in a party at Schiff's house, in honor of the new Hebrew year. Also, Yaron-Eldar had interned at Schiff's office: he was the power moving for her appointment as income tax commissioner.
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