We asked IsraelDesks members to offer their superstar analysis of the changes, which are designed to strengthen Israel’s position as a global innovation hub while ensuring greater transparency and competitiveness for international investors.

Removing barriers, reducing uncertainty

A central theme of the reform is certainty – especially for multinationals and cross-border investors, who previously had to navigate a patchwork of rulings and informal practices. “The reform provides regulatory certainty and beneficial tax treatment to the major players in the Israeli high-tech ecosystem, including giant multinational companies, venture capital funds and other types of tech investors in the Israeli technology market, and tech workforce talent,” says Meir Linzen, Chairman of Herzog Fox & Neeman (“Herzog”), and head of its Tax, Private Client, Gaming & Gambling Departments.

One of the reform’s key aspects: clarification of how income is attributed to Israeli R&D centers.

“A recent publication by the Israel Tax Authority (ITA) provides multinational companies active in the sector with clear rules on the income attributed to their Israeli R&D centers, often employing thousands of engineers in Israel,” adds Dr. Yuval Navot, head of Herzog’s Corporate Tax Department. “The publication clarifies that the income attributed to Israel will be subject to the ‘cost-plus’ method and that the ITA will not be inclined to treat Israeli R&D centers as profit centers for multinational enterprises, which would otherwise require that centers’ operations be recognized as part of enterprises’ net profit.”

This clearer framework reduces the risk of reclassification disputes and gives multinationals a more predictable view of their long-term tax exposure in Israel.

From a broader policy perspective, Dr. Eran Lempert, head of the Tax Department at Erdinast, Ben Nathan, Toledano & Co. suggests these changes are part of a deliberate shift. “Recent developments indicate that the Israeli government is actively replacing areas of ambiguity in its tax regime with greater certainty aligned to international standards,” he says. “The draft regulations published as part of the proposed tax reform seek to codify the preferential treatment historically available to foreign investors, enabling transaction parties to assess tax outcomes upfront rather than relying on tailored and often difficult to obtain – pre-rulings from the Israel Tax Authority.”

He adds that “the ITA’s new R&D circular formalizes transfer-pricing parameters and provides a clearer framework for asset and IP acquisitions, as well as for the structuring and operation of post-transaction R&D centers. Collectively, these measures reduce deal-execution risk, shrink the tax cushion typically built into pricing, and enhance the predictability of post-closing operations for multinational groups.”

“Revolutionary for global funds”

The reform also targets one of the long-standing friction points for global investors: having to contend with bespoke pre-rulings and complex structures to secure favorable tax treatment.

Miri Bickel, head of the Tax Department at Shibolet, explains just how significant this is for venture capital funds, many of which had previously sat on the sidelines: “The reform is revolutionary for global funds,” she points out. “The fixed tax treatment and VAT exemptions eliminate the need for complex structures designed to optimize tax treatment between Israeli and foreign investors, which is a fundamental change that opens the Israeli market to many funds that had previously refrained from investing due to the lengthy and burdensome bureaucratic process. Funds that did not meet the strict pre-ruling criteria or simply did not wish to engage in a process that could take long months (at best) can now invest in Israel immediately and automatically enjoy tax benefits. This allows funds to focus on identifying and executing investments rather than on complex tax structuring and administrative hurdles.”

Guy Katz, senior partner at Herzog, notes that “the proposed regulations suggest codifying tax exemptions for limited investors on capital gains, interest, and dividends earned on investments in technology companies. The Israeli managing partners in these funds (the GP) are entitled to a reduced tax rate (27%) on the carried interest. Non-Israeli managing partners are also subject to preferential taxation on their carried interest from Israeli exits, and in cases where they are subject to tax in Israel, such tax will be capped at 10%.”

Widens the tax exemption to non-Israeli tech investors

The proposed legislation widens the tax exemption to non-Israeli tech investors, like corporate VCs, angel investors, and family offices. “The exemption applies even where investors have a so-called permanent establishment in Israel, such as an office in Israel managing these investments,” Herzog’s Katz adds.

Shibolet’s Bickel explains: “The capital gains tax exemption for direct investments makes it more attractive for institutional investors and companies to invest directly in Israeli high-tech companies, without the need to establish fund structures. The fixed formulas for calculating VAT on management fees based on the ratio between foreign and Israeli investors provide financial predictability and enable more accurate economic planning.”

More M&A flexibility for tech companies

On the corporate side, the reform removes obstacles that previously constrained growth through mergers and acquisitions.

“For technology companies, the new legislation regarding structural changes has already been approved, effectively removing significant barriers for investments and growth through acquisitions,” says Shibolet’s Bickel. “This is a major change that enables transactions and exits in circumstances where the corporate structure previously made them impossible, allowing it to act with much greater flexibility. Israeli companies can now offer a more attractive corporate structure to investors and grow more organically by acquiring other companies.”

Additionally, she highlights what the reform means for exits and cross-border deals: “Clear guidelines on intellectual property valuation and transfer pricing methods significantly reduce uncertainty in exit scenarios involving multinational buyers, allowing companies and their investors to better plan their exit strategies and understand their expected tax liabilities in advance. The ability to obtain pre-rulings on transfer pricing enables multinational corporations operating R&D centers in Israel to structure their operations with full confidence in their tax position, encouraging long-term investment and expansion in Israel. The simplified M&A processes encourage Israeli companies to grow through mergers, creating larger and more competitive players in both the local and global markets.”

Welcome home

The Government of Israel has released draft resolutions tied to the 2026 state budget, including a proposal titled “Encouraging Aliyah and Return to Israel through Tax Benefits.” The measure would grant a temporary tax exemption to individuals who become Israeli residents for the first time in 2026, as well as to veteran returning residents.The reform is also aimed at Israelis abroad who might otherwise hesitate to return because of unclear or punitive tax treatment of their equity compensation. Historically, professionals working abroad and holding stock options or RSUs often faced uncertainty regarding their tax obligations upon returning to Israel. But that’s all changing now.

Daniel Paserman, head of Tax Department at Gornitzky GNY, together with fellow partner Adi Haya Raban, authored a key update explaining the proposal: “According to the proposal, an individual who immigrates to Israel during 2026 (and during that year only) and qualifies as a “first-time resident” or a “veteran returning resident” (i.e., an individual who has been a foreign resident for ten consecutive years prior to returning to Israel) (collectively, “Eligible Individuals”), will be entitled to an exemption on Israeli-sourced earned income as follows: for 2026–2027, up to NIS 1,000,000; for 2028, up to NIS 600,000; for 2029, up to NIS 350,000; for 2030, up to NIS 150,000. Israeli-sourced earned income exceeding the above exemption thresholds will be taxable in Israel, but will enjoy the lower progressive tax brackets applicable to earned income, as well as standard personal tax credits and deductions.”

“For returning professionals, determining clear guidelines for allocating equity-based income between Israel and abroad provides significant certainty and removes one of the main barriers to returning to Israel,” says Vered Meller, partner in the Tax Department at Shibolet. “Until now, professionals who worked abroad and held stock options or RSUs often faced uncertainty regarding their tax obligations upon returning. The exemption from tax on income generated and accrued outside of Israel eliminates concerns about double taxation and clarifies that Israel will not tax income earned during periods of non-residency.”

“This represents a significant shift that eliminates a major disincentive to returning home,” they continue. “The mechanism for crediting foreign taxes paid on income also taxable in Israel prevents double taxation and ensures that professionals will not pay tax twice on the same income. The creation of a ‘green tax track’ for transitioning from Section 3(i) equity compensation taxation to Section 102 simplifies the return process and removes obstacles that previously discouraged relocation. The anticipated legislation to enhance certainty in determining tax residency based solely on the number of days spent in Israel creates certainty regarding the determination of residency and stability in governmental policy. Individuals will receive certainty regarding their tax residency status.”

Navot (Herzog), adds: “For returning Israelis and new immigrants in the tech sector, the improved stock-option regime financially facilitates relocation by removing regulatory barriers.”

“A new business environment”

Taken together, the reforms signal that Israel is deliberately recalibrating its tax regime for a more competitive, more predictable, globally integrated high-tech economy.

Shibolet’s Meller says the reform “creates a new business environment in which decision-making is accelerated due to reduced uncertainty and the removal of bureaucratic barriers, transaction costs are lowered through simplified procedures and clear guidelines, Israel’s competitive position strengthens compared to other leading global high-tech hubs, and long-term planning becomes feasible thanks to predictable tax treatment throughout the corporate lifecycle.”

Lempert (EBN) notes these changes “reduce deal-execution risk, shrink the tax cushion typically built into pricing, and enhance the predictability of post-closing operations for multinational groups,” adding that they “signal a deliberate shift toward a more transparent and investment-friendly tax environment in Israel.”

Herzog’s Linzen says the practical impact is clear: reduced friction and uncertainty, making Israel a more attractive base of operations. “The reform reflects a broader move toward increased certainty and clearer technical guidance,” he argues. “The draft regulations issued by the Ministry of Finance, along with the ITA’s circulars and position papers, indicate an effort to formalize methodologies in areas that often involve inconsistent treatment in matters such as profit attribution, IP valuation, and capital gains tax exemptions.”

The prowess of Israel’s tech sector is widely recognized across the globe. The certainty and clarity this tax reform provides might be one of its biggest innovations yet.

The post Israel’s Tech Tax Reforms appeared first on IsraelDesks.

We are pleased to invite you to submit your matters to the 8th Israel Desks League Tables, which recognizes those global law firms that continue to propel their clients’ Israel-related activity in these demanding times. Today, the number of law firms with an Israel Desk has now reached approximately 160 — a 20% increase since 2019, underscoring sustained global interest even in challenging periods.

As in previous years, we invite firms to complete a simple submission template and nominate their lead lawyers so we can highlight standout individuals across the market. Submissions categories include Energy & Infrastructure, Banking & Finance, High-Tech, and Real Estate, as well as Israel-related M&A, Capital Markets, Employment, Litigation, Private Client and Tax, and IP and Patents.

Click here to view the 2025 rankings.

The deadline to submit is January 30th, 2026.

The Publication date is mid-April 2026.

Please submit to the following email addresses: daniel@nishlis.com

Review Instruction, Methodology and FAQs.

Download Submission Form.

Although free of to enter, only law firms who are IsraelDesks members will receive a full editorial.

The IsraelDesks League Tables are the only legal industry tables for global law firms with Israel desks, and the tables are valued by Israeli law firms and their clients. The tables recognize those law firms and lawyers advising on transactions and matters that involve Israeli clients and educate the local market as to where to send work abroad.

If you have any questions, technical or otherwise, relating to the submission, please feel free to email Lee Saunders at: lee@nishlis.com.

About Legally 100 – IsraelDesks League Tables:

The IsraelDesks League Tables are the only legal industry tables for global law firms with Israel desks, and tables valued by Israeli law firms and their clients. The tables recognize those law firms advising on transactions and matters that involve Israeli clients and educate the local market where to send work to abroad.

Benefits: 
Whether Venture Capital financings, M&A or Capital Markets offerings, the objective of the pioneering IsraelDesks League Tables is to (1) showcase those global law firms with the interest, commitment and instructions in the Israeli market and (2) to use these tables to raise their profile before an extremely interested Israeli audience of lawyers, General Counsel and prospective clients.

Eligibility:
The entering firm must be headquartered or have its head office outside of Israel.

You’re nominated transactions or matters must be either ongoing now or completed between January 1st, 2025 and December 31st, 2025.

How do I submit?
Free to enter, the process could not be simpler. There is a clear spreadsheet asking for minimal information about completed deals, which needs to be emailed to daniel@nishlis.com by January 30th 2026.

How is it judged?
Our methodology is purely quantitative. All the submissions are collated and analysed and, after a league table is determined, the rankings are decided looking at the volume and value of matters.

Where will it be Published?
The league tables will be published on the IsraelDesks website, in the US/Israel guide; Israeli financial press; leading industry organisations in Israel; via social media and to our extensive distribution list – to be seen by corporate lawyers and GCs.

The post Legally Israel 100 – IsraelDesks League Tables 2026 Deadline appeared first on IsraelDesks.

The fundraising supports the company’s continued clinical development and strengthens its position in the growing psychedelics therapeutics market.

Greenberg Traurig Tel Aviv advised Clearmind Medicine, led by shareholder David Huberman, together with associate Michael Soumas.

The post Clearmind Completes November Offerings appeared first on IsraelDesks.

The initiative follows a sharp global increase in antisemitic incidents since October 7, 2023, and targets high-socioeconomic individuals who may now consider relocating.

The government views attracting this population as a way to strengthen the economy and reinforce long-term national resilience.

Gornitzky & Co. prepared this update, authored by Daniel Paserman and Adi Haya Raban, summarizing the draft resolution released as part of Israel’s 2026 budget discussions.

Read more in Gornitzky & Co.

The post Israel Plans New 2026 Tax Benefits appeared first on IsraelDesks.

The multiyear project includes new residential and commercial construction, major infrastructure upgrades, and targeted investment to draw businesses, research activity, and innovation into the region.

Learn more in Jerusalem Post.

The post Israel Backs NIS 1.2 Billion Beersheba Plan appeared first on IsraelDesks.

The 70,000-sqm site will include R&D labs, silicon-wafer fabrication, and advanced chip assembly and testing operations, employing roughly 350 people, including 150 in R&D. AWZ aims to produce III–V chips integrated into silicon for AI, quantum computing, 5G/6G, and defense-tech applications.

The initiative is moving forward with support from the Ministry of Economy, the Innovation Authority, and the Israel Land Authority, marking a significant boost for Israel’s semiconductor and deep-tech industries.

Read more in Globes.

The post AWZ Backs Major Israel Chip Plant appeared first on IsraelDesks.

He will co-head the Israel Practice with Samuel E. Feigin, Shareholder in the Washington DC office, and work closely with the firm’s corporate, tax, and litigation teams.

We caught up with Samuel:

How will the expansion of Cozen O’Connor’s global tax and Israel practice deepen support for Israeli companies operating or investing in the U.S., particularly as cross-border tax and regulatory issues become more complex?

“Oz is a phenomenally talented and driven tax and business advisor whose addition enhances significantly our ability to advise Israeli companies and investors doing business and deals in the US from market entry as operators or investors and including the gamut of tax and deal structuring activity. Israeli companies and investors face increasingly intricate rules around U.S. taxation, corporate structuring, regulatory compliance, and technology focused restrictions—and few, if any practitioners have been more focused on this space and these issues than Oz.

With the depth and breadth of experience that Oz brings to the table, we now have a truly full service, integrated team when it comes to representing Israeli clients doing business in the States – from corporate transactions to real estate to the complete array of regulatory areas to employment to IP to disputes to government affairs -and much more.”

What new opportunities or advantages does this strengthened Israel-focused team create for Israeli clients — whether startups, multinationals, or high-net-worth families?

Samuel: “The addition of a sophisticated tax attorney whose efforts have been concentrated in this arena provides businesses and families pursuing cross-border growth and wealth planning with unparalleled support. Startups and middle market players will enjoy smart, integrated guidance on entity selection, venture financing, IP migration and commercial rollout into the U.S.

Those which are already multinationals will benefit from seamless support on cross border reorganizations, transfer pricing structures, supply chain alignment and compliance with evolving tax and regulatory regimes.

High net worth families can rely on tailored solutions from Oz and our renowned Private Client team that deliver the most sophisticated advice and dedicated service with respect to tax protection, investment structuring, global mobility and estate planning.

By combining local familiarity with deep U.S. regulatory expertise, the Cozen team enables Israel-related clients to confidently expand, invest and preserve assets across borders while minimizing risk and optimizing economic outcomes.”

Read more in Cozen O’Connor.

The post Cozen O’Connor Strengthens Israel Practice appeared first on IsraelDesks.

The NIS 76 million acquisition marks a major step in Brand Group’s growth strategy as it broadens its reach across engineering, infrastructure, technology, defense, and renewable energy. The move strengthens the company’s position in Israel’s wider industrial and services ecosystem.

Shibolet advised Brand Group Ltd., led by Itay Kellner, Mor Weiss, Ori Haubenstock, and Dana Adler, with support from Keren Maimon Sandler, Omer Elisha, Ofir Malalis (Labor & Employment), and Gil Rosenberg (Antitrust & Competition).

The post Brand Group Expands With Purchase of Israel’s Natun appeared first on IsraelDesks.

Doti builds a secure “Organizational Brain” that lets employees access company knowledge in real time through tools such as Slack. Calcalist estimates the deal to be around USD 100 million.

The deal strengthens Salesforce’s AI R&D center in Israel and advances its agentic search and knowledge-discovery capabilities. F2 records a strong outcome after also leading Doti’s Seed round just one year earlier.

Meitar advised Salesforce, led by Tomer Shani, with a team consisting of Mouna Totry,Idan Sides ,Nicole Feld,Ignacio González, Mona Sbait Khoury, Tom Maor, Sara Weinberger, Mona Sbait Khoury, Tom Maor and Eden Abraham.

Erdinast, Ben Nathan, Toledano advised F2 Venture Capital, spearheaded by Roy Caner, Yael Benyayer, and Amit Horovitz.

The post Salesforce Acquires Israel’s Doti AI appeared first on IsraelDesks.

The company, which employs 120 people and manages over one million energy-infrastructure projects in the U.S., was already profitable and raised only about USD 70 million in total funding.

Locusview’s founder said the acquisition was driven by the energy revolution sparked by AI and the company’s ambition to partner with a global brand.

Herzog Fox & Neeman advised Locusview, with an extensive team including Tomer Farkash, Nathan Wiesenberg, Adriana Chiche, Yarden Elter, Itay Hoyzman, Dr Ehab Farah, Shachar Porat, Karen Elburg, Liat Shaked-Katz, Avishag Kaspit Pashay, Ruly Bar, Olga Pery, Yuval Zilber, Lynn Holt Ashkenazi, Amit Ohn, Yael Jakubowicz, Ofer Granot, and Shiran Stein.

Sidley advised the buyer Itron with H-F as Israeli counsel.

The post Israel’s Digital Construction Platform Locusview Bought For USD525m appeared first on IsraelDesks.