Too Big to Pay: Heirs to One of Israel's Biggest Fortunes to Pay Just $27,400 in Taxes

Sides reach settlement after government sought as much as 930 million shekels from estate

Ofer Vaknin

The heirs to the estate of Sammy Ofer, one of Israel’s wealthiest men, will pay a tax bill of just 107,000 shekels ($27,400) – a tiny fraction of the 930 million shekels the government once demanded for the years 2006-10.

In fact, the government had already given up on the lion’s share of the claim. In July 2014, Haifa District Court Judge Ron Sokol approved a settlement that said Ofer wasn’t liable for tax for the years 2006-09.

The government, however, was still intent on collecting tax for 350,000 shekels of income for 2010. But Judge Sokol ruled last August that the amount didn’t justify a prolonged legal process. The heirs then agreed under protest agreed to a 107,000-shekel liability. Only on Monday, however, were details of the settlement released to the public.

The dispute began after Ofer’s heirs refused to provide the Tax Authority with information about his money for the five years prior to his death in 2011, contending that he wasn’t a resident of Israel in those years and didn’t have to file a tax report. In response, the authority issued an assessment on what it estimated was 2 billion shekels of income for those years.

Ofer’s heirs appealed the decision in Haifa District Court, saying he had not been a resident in Israel except in 2004 , although he died in Israel during a visit. They also contended that even if he were a resident, he was entitled to five years of tax exemptions as a returning citizen.

It appears that government lawyers couldn’t prove Ofer was a resident of Israel and thus gave up its demands for the years 2006-09.