Israel Forms Panel on Natural Resource Royalties, Tax Policy

Israel has appointed a panel to examine government policy on royalties and taxes paid by companies which use natural resources.

The panel will be headed by Eytan Sheshinski, a professor emeritus from the Hebrew University of Jerusalem, the Finance Ministry said in an e-mailed statement. A similar Sheshinski-led committee’s recommendations three years ago were the foundation for a government decision to more than double its share in gas and oil profits, Gilad Alper, senior analyst at Tel Aviv-based Excellence Nessuah Brokerage Ltd., said by telephone.

Finance Minister Yair Lapid, who took office in March and is jostling to plug a large budget deficit, said in April that natural resources are a public asset and that the Israeli public should be the first to benefit from them. Lapid made the statement when he announced his opposition to Potash Corp. of Saskatchewan Inc.’s proposed purchase of Israel Chemicals Ltd. He pledged then to reexamine natural resource policy.

“Sheshinski is a person who’s in the habit of making big decisions,” Alper said. “He has already said publicly that ICL isn’t paying close to enough, which means there’s a good chance that the recommendations will be very negative for ICL.”

Israel Chemicals declined as much as 4.07 percent, and traded at 38.76 shekels at 12:15 p.m. in Tel Aviv, as Israel Corp., which controls Israel Chemicals, declined as much as 5.34 percent.

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