The original article smelled wrong when they claimed to have broken AES. Thankfully, Bruce Schneier is far more authoritative than I ever will be and gives a short and succinct list of links to debunkings of this.

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).