Israel Tax Agency Announces Bill on Taxation of Undistributed Profits

The Israeli Tax Authority Dec. 26 announced a bill on the taxation of undistributed profits, within the framework of the Arrangements Law for 2025. The bill includes measures to: 1) specify that the bill focuses on active wallet and holding companies; 2) impose a marginal tax on the controlling shareholders of active portfolio companies regarding a company’s undistributed profits exceeding 25 percent of turnover; 3) explain that the marginal tax will be imposed on companies whose business turnover is up to 30 million Israeli shekels (US$8.1 million) per year and whose undistributed profits exceed 750,000 shekels (US$203,287), not applicable to ...