Israel's Weizmann Institute Contests Multimillion Tax Bill on Royalty Payments

The public research university was not charged any taxes for its royalty revenues for the past 15 years, but argues that the charge violates an earlier agreement with the Israel Tax Authority

Efrat Neuman
Efrat Neuman
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Weizmann Institute of Science, 2019.
Weizmann Institute of Science, 2019.Credit: Dor Kadmi
Efrat Neuman
Efrat Neuman

The Israel Tax Authority is charging the Weizmann Institute of Science 205 million shekels ($60.18 million) in royalties that the Rehovot establishment collected in 2015, an appeal filed in court against the charge says.

The lawsuit filed on Monday, argues that the bill is illegal, violates Tax Authority policy, and was processed without giving the research institute a chance to argue its case.

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The argues that while the authority had four years to file the bill, it began the process - by demanding paperwork from the Weizmann Institute - less than a month before the statute of limitations took effect, and issued the bill on the day of a deadline.

The institute argues that the bill violates the terms of an agreement it signed with the authority some 16 years ago, under which royalty revenues would be tax exempt, as the Weizmann Institute is a public institution.

For 15 years the institute was not charged any taxes for its royalty revenues.

But the authority argues that Weizmann is not holding up its end of the deal, and ought to reexamine whether royalty revenues should be categorized as revenue.

The case is scheduled to be heard in mid-December.

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