Tax Authority is demanding NIS 205 million in royalties from the Weizmann Institute

The Tax Authority is demanding NIS 205 million in royalties from the Weizmann Institute that the institute received in 2015, according to the institute's appeal to the court to overturn the decision.
In a lawsuit filed yesterday (Monday) by the institute by way of an opening motion (a speedy procedure appropriate to specific cases) it was alleged that the assessment was made illegally, contrary to the directives of the tax authority, and without allowing the institute's representatives to make their claims.
The lawsuit states that although the IRS had about four years to issue the assessment, the audit began - through a first requirement to submit documents - less than a month before the statute of limitations, and the assessment was issued on the last day of the statute of limitations.
It is also written that the assessment deviates from the application of a formula in an agreement that the institute had with the tax authorities more than 16 years ago, according to which the income from royalties will be tax-exempt since it is a public institution. This was the case for 15 years, and the institute was not taxed on its royalties. The Authority now argues that the institute itself does not meet the formula, so the question of classifying income from royalties as income from business should be examined.
The lawsuit reads: "The Assessing Officer acted in bad faith, had telephone conversations on tight and illogical schedules, and did not allow the institute's representatives to make their claims - contrary to the provisions of the ordinance and the basic rules of justice and fairness."
The hearing in the case is scheduled for mid-December, and will be adjudicated by Judge Avi Gorman of the Central District Court.