Beny Steinmetz appeals tax on sale of NIS 27m house

Israeli billionaire Beny Steinmetz and his family are appealing a betterment tax of NIS 4.35 million imposed by the Israel Tax Authority on the sale of a luxury house in Arsuf for NIS 27 million. The appeal, filed by Leon Bouaziz, argues the property was a private residence, not a business, and challenges the corporate tax rate and depreciation deductions.

Israeli billionaire Beny Steinmetz and his family are battling the Israel Tax Authority in the Lod District Court over a betterment tax of NIS 4.35 million on the sale of a luxury house in Arsuf for NIS 27 million. Roughly NIS 1 million has already been paid, leaving over NIS 4.1 million in dispute. The property was purchased in the 1990s for $2.7 million, worth about NIS 8.1 million at the time. The appeal was filed by Leon Bouaziz, father of Steinmetz's wife Agnes Bouaziz, through the Amit, Pollak, Matalon & Co. law firm. Bouaziz held the property as trustee for Triwoodis, a holding company owned by the Steinmetz family. Bouaziz sold the house directly to private buyers and sought to pay tax as a sole seller of residential property, but the Tax Authority deemed the foreign company the beneficiary, subjecting it to full corporate tax. The appeal claims the Tax Authority's starting point is fundamentally wrong, focusing on formal registration while overlooking that the Steinmetz family provided the full purchase money, maintained the household, and lived in the house. It also challenges the depreciation deduction of about NIS 4.76 million, arguing the house was used exclusively as a private residence, never rented, and produced no income. The appeal asks to cancel the corporate tax charge, the notional depreciation, and recognize brokerage and renovation expenses, advocating for taxation as a single seller with a much lower betterment tax.