Intel, whose investment will be over five years, will pay a corporate tax rate of 7.5% instead of 5% previously. The normal tax rate is 23%, but under Israel’s law to encourage investment in development areas, companies receive large benefits.
Usually these types of grants are never a good investment but the increased corporate tax rate alone covers a third of the grant (9b yearly taxable revenue at 2.5% over 5 years comes out to 1.125b).
That’s the same kind of logic you use about how much you saved when you buy something on sale. Would have saved more if you didn’t buy it at all; Israel would collect more tax money if they didn’t give them massive subsidies and tax breaks.
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Usually these types of grants are never a good investment but the increased corporate tax rate alone covers a third of the grant (9b yearly taxable revenue at 2.5% over 5 years comes out to 1.125b).
That’s the same kind of logic you use about how much you saved when you buy something on sale. Would have saved more if you didn’t buy it at all; Israel would collect more tax money if they didn’t give them massive subsidies and tax breaks.