Israeli billionaire Beny Steinmetz and his family are waging a battle in the Lod District Court against the decision by the Israel Tax Authority real estate tax director in Netanya to impose a betterment tax of NIS 4.35 million for the luxury house sold in Arsuf for NIS 27 million. Roughly NIS 1 million in tax has already been paid to the Tax Authority, and now the amount in dispute is more than NIS 4.1 million. The property was purchased in the 1990s for $2.7 million, which was worth about NIS 8.1 million at the time.
The appeal was filed by Leon Bouaziz, the father of Steimetz’s wife Agnes Bouaziz, through the Amit, Pollak, Matalon & Co. law firm. Bouaziz held the property as a trustee for Triwoodis, a trustee holding company owned by the Steinmetz family.
In the deal, Bouaziz sold the house directly to private buyers. However, while Bouaziz sought to pay the tax imposed on a sole seller of a residential property, the Tax Authority set that the foreign company should be considered the beneficiary of the sale, and therefore subject to full corporate tax.
The appeal claims that the Tax Authority’s starting point is fundamentally wrong. Among other things, it claims that the Tax Authority has been over zealous in paying attention to the formal registration of the company, completely overlooking the fact that the Steinmetz family provided the full purchase money, maintained the household economically, and lived in the house over the years.
The issue of depreciation
Another central claim concerns the depreciation that the Tax Authority applied to the property, a factor that significantly increased the tax payable. The Tax Authority director deducted accumulated depreciation of about NIS 4.76 million from the purchase value of the house, claiming that a property owned by a company is considered a business.
On the other hand, the appeal insists that the house was used exclusively as a private residence and hosting family guests, was never rented out, and did not produce income. Therefore, the appeal claims, the company had no business activity, and did not deduct depreciation in practice, so that the deduction of this amount creates a tax debt that does not reflect reality.
In summary, it asks the Appeals Committee to intervene in the tax decision to cancel the corporate tax charge, cancel the notional depreciation, and recognize brokerage and renovation expenses. The correct way, according to Bouaziz, is to tax the sale as a sale by a single seller, paying a much lower betterment tax than that set by the Tax Authority.
Published by Globes, Israel business news – en.globes.co.il – on August 3, 2026.
© Copyright of Globes Publisher Itonut (1983) Ltd., 2026.
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