In addition, the recommendations include concessions in respect to reservoirs that will start producing gas by 2014. Profits from these reservoirs will pay taxes only after earning 200% of their initial investment (compared to 150% in the interim report.)
The maximal royalty rate of 50% will only be imposed on these reservoirs once they accumulate profits of 280% on their investment.
At the opening of a press conference on the matter Monday, Finance Minister Yuval Steinitz said: "After almost nine months, the Shishinsky Committee – the most professional committee ever established in Israel in the area of gas and oil resources – has completed its work."
"We are a state that encourages entrepreneurship. One of the committee's missions was to find the right balance between investor profitability…and the need to ensure that the State of Israel is rewarded for its natural resources."
"A situation whereby citizens of the State of Israel are almost the only ones in the world – and certainly in the Western world – who do not benefit from natural resources is intolerable, and we're changing it here and now," he said.
The minister said that the area of natural resources had been neglected for some 60 years, noting that in the past 60 years all Western states raised the tax and royalty rate in the industry. Earlier, OECD representatives also endorsed the interim conclusions of the Shishinsky Committee.