State Comptroller: Teva is required to pay the state treasury a tax totaling NIS 6.9 billion

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by Ifi Reporter Category:Hitech Nov 23, 2022

Teva is required to pay the state treasury a tax totaling NIS 6.9 billion. The company is conducting a series of legal proceedings with the Tax Authority regarding this demand, which has not yet been decided. The company's stock closed trading in Tel Aviv with a decrease of more than 6.5% and at this time it is trading on Wall Street with a decrease of about 3%.
In the Stat report on the tax system, published today (Wednesday), it is stated that "as of June 2021, 2,801 tax orders are being discussed in legal courts, in which the amount of income tax that is changed in the departments in civil legal proceedings is approximately NIS 28.1 billion... of which NIS 6.9 billion in respect of nine warrants that were issued to one large company in the Israeli economy."
This company is Teva, which receives tax benefits in Israel - but is still required by the tax authority to pay a high tax for its activities in the local market. In the rest of the report it is written that the same nine tax orders were issued to "a company entitled to pay a reduced tax under the law for the encouragement of capital investments, for the years 2008-2016". The total amount of the required tax is actually NIS 7.3 billion, of which Teva transferred NIS 400 million to the state which are not in dispute. The balance is currently being discussed in court.
At the beginning of November, Teva reported to investors that the revenue and profit forecast had been missed, an 8% drop in revenue to $3.6 billion and a 6% drop in non-GAAP operating profit to $977 million.

"Teva Pharmaceuticals U.S." affiliate of Teva Pharmaceutical Industries announced today that the company has finalized the documentation of its proposed nationwide opioid settlement with both the working group of States’ Attorneys General and the Multi-District Litigation Plaintiffs’ Executive Committee. Allergan has also finalized its settlement terms. As announced during the Company’s third quarter earnings call, Teva and Allergan have resolved their dispute with respect to Teva's indemnification obligations. 

The sign-on process for states will now begin, followed by a similar sign-on process for the states’ subdivisions and special districts. Given the high participation rate in other nationwide opioids settlements -- and Teva’s settlements with Texas, Florida, Louisiana, Rhode Island, West Virginia, San Francisco and New York -- we remain optimistic that a high participation rate in this nationwide settlement will be achieved, enabling us to put these cases behind us and continue to focus on the patients we serve every day.


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