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Israeli Lawmakers Seek to Lower Capital Gains Tax to Draw Foreign Investment Despite Gaza War
Israeli Finance Minister Bezalel Smotrich attends an inauguration event for Israel’s new light rail line for the Tel Aviv metropolitan area, in Petah Tikva, Israel, Aug. 17, 2023. Photo: REUTERS/Amir Cohen
Israel’s parliament, known as the Knesset, is considering a proposal to lower the country’s capital gains tax from 25 percent to 20 percent in a bid to draw foreign investment despite the ongoing war with the Hamas terror group in Gaza.
Likud Party MK Eliyahu Revivo proposed the change to the capital gains tax during a session of the Knesset’s Finance Committee this week, a move praised by major trade groups and leading economists seeking innovative ways to give the economy a push until the war ends.
Israel, nicknamed the “startup nation,” has been generally considered a strong foreign investment bet, with industries such as high-tech and real estate having grown significantly over the past few decades.
Since the start of this year, however, investment has been down. This trend began before Hamas’ Oct. 7 massacre across southern Israel, as investment from abroad took a hit due to uncertainty over the Israeli governing coalition’s judicial reform package, which brought hundreds of thousands of Israelis onto the streets to protest. One of the results of the deep domestic divide that ensued was pushing away some foreign investment.
With the war in Gaza, which began with the Hamas atrocities last month, investment has slowed due to uncertainty surrounding business. Indeed, Israel’s business sector has been hit hard, with many finding it next to impossible to work on anything unrelated to the conflict.
Reserve duty in particular has become a major challenge for business across Israel as more than 350,000 people were called from their homes to join the war, taking them away from work — including the tech sector. In real estate, meanwhile, some of the biggest growth in recent years has been in so-called smaller “periphery cities,” places that have been impacted by the war and in some cases even evacuated.
Controversy erupted this week over a newly approved wartime budget, which some members of the Knesset railed against since not all the money was allocated to the war effort. Israeli Finance Minister Bezalel Smotrich backed his budget plan, saying there was enough money at the moment to support military matters and all other areas.
Ultimately, Smotrich’s ministry will be the one to give a green light to Revivo’s new plan, which supporters argue could help to increase investment from places such as France and the United States.
Tech has become a backbone of Israel’s economy, and a reason why even in global economic crises the Israeli economy can remain resilient. Indeed, tech has accounted for 14 percent of jobs in Israel and about a fifth of economic output. Last year, Israeli tech companies raised nearly $16 billion, the highest per capita in the world, after raising $27 billion the previous year. The tech sector also accounted for about half of Israel’s exports and 30 percent of tax revenue.
The Jewish state has consistently been among the world’s ten largest tech ecosystems in terms of funding despite being much smaller than its competitors at the top of the list.
The post Israeli Lawmakers Seek to Lower Capital Gains Tax to Draw Foreign Investment Despite Gaza War first appeared on Algemeiner.com.
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Merz Says Criticism of Israel in Germany Has Become Pretext for Hatred of Jews
German Chancellor Friedrich Merz attends celebrations of the newly completed renovation of Reichenbach Strasse synagogue in Munich, Germany, Sept. 15, 2025. Photo: REUTERS/Angelika Warmuth
Chancellor Friedrich Merz said on Wednesday that criticism of Israel was increasingly being used in Germany as a pretext for stoking hatred against Jews.
Speaking at an event to mark the 75th anniversary of the founding of the Central Council of Jews, Merz said that antisemitism had “become louder, more open, more brazen, more violent almost every day” since the Hamas-led attacks on Oct. 7, 2023, that ignited the Gaza war.
“‘Criticism of Israel‘ and the crudest perpetrator-victim reversal is increasingly a pretext under which the poison of antisemitism is spread,” he said.
Germany is Israel‘s second biggest weapons supplier after the US, and has long been one of its staunchest supporters, in part because of historical guilt for the Nazi Holocaust – a policy known as the “Staatsraison.”
Last month, however, Germany suspended exports of weaponry that could be used in the Gaza Strip because of Israel‘s plan to expand its operations there – the first time united Germany had acknowledged denying military support to its long-time ally.
The decision followed mounting pressure from the public and his junior coalition partner over the humanitarian crisis in Gaza.
In his speech in Berlin on Wednesday, Merz mentioned his about-turn, saying that criticism of the Israeli government “must be possible,” but added: “Our country suffers damage to its own soul when this criticism becomes a pretext for hatred of Jews, or if it even leads to the demand that Germany should turn its back on Israel.”
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Israeli Anti-Missile Laser System ‘Iron Beam’ Ready for Military Use This Year
Iron Beam laser defense system. Photo: X/Twitter screenshot
A low-cost, high-power laser-based system aimed at destroying incoming missiles has successfully completed testing and will be ready for operational use by the military later this year, Israel’s Defense Ministry said on Wednesday.
Co-developed by Elbit Systems and Rafael Advance Defense Systems, “Iron Beam” will complement Israel’s Iron Dome, David’s Sling, and Arrow anti–missile systems, which have been used to intercept thousands of rockets fired by Hamas terrorists in Gaza, by Hezbollah from Lebanon, and by the Houthis in Yemen.
Current rocket interceptors cost at least $50,000 each while the cost is negligible for lasers, which focus primarily on smaller missiles and drones. “Now that the Iron Beam’s performance has been proven, we anticipate a significant leap in air defense capabilities through the deployment of these long-range laser weapon systems,” the ministry said.
After years in development, the ministry said it tested Iron Beam for several weeks in southern Israel and proved its effectiveness in a “complete operational configuration by intercepting rockets, mortars, aircraft, and UAVs across a comprehensive range of operational scenarios.”
The first systems are set to be integrated into the military‘s air defenses by year-end, it said.
Shorter-range and less powerful laser systems are already in use.
Iron Beam is a ground-based, high-power laser air defense system designed to counter aerial threats, including rockets, mortars, and UAVs.
“This is the first time in the world that a high-power laser interception system has reached full operational maturity,” said defense ministry Director-General Amir Baram.
Rafael Chairman Yuval Steinitz said that Iron Beam, which is built with the company’s adaptive optics technology, “will undoubtedly be a game-changing system with unprecedented impact on modern warfare.”
For its part, Elbit was working on the development of high-power lasers for other military applications, “first and foremost an airborne laser that holds the potential for a strategic change in air defense capabilities,” CEO Bezhalel Machlis said.
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Iran and European Ministers Make Little Progress as Renewed UN Sanctions Loom, Diplomats Say
Iranian Foreign Minister Abbas Araqchi speaks during a meeting with foreign ambassadors in Tehran, Iran, July 12, 2025. Photo: Hamid Forootan/Iranian Foreign Ministry/WANA (West Asia News Agency)/Handout via REUTERS
Iranian and European ministers made little progress in talks on Wednesday aimed at preventing international sanctions on Tehran over its nuclear program being reimposed at the end of this month, two European diplomats and one Iranian diplomat said.
Britain, France, and Germany, the so-called E3, launched a 30-day process at the end of August to reimpose UN sanctions. They set conditions for Tehran to meet during September to convince them to delay the “snapback mechanism.”
The offer by the E3 to put off the snapback for up to six months to enable serious negotiations is conditional on Iran restoring access for UN nuclear inspectors – who would also seek to account for Iran‘s large stock of enriched uranium – and engaging in talks with the US.
The status of Iran‘s enriched uranium stocks has been unknown since Israel and the US bombed Iranian nuclear sites in June.
TALKS WITH EUROPEANS FOLLOWED ACCORD WITH IAEA
Wednesday’s phone call between the E3 foreign ministers, the European Union foreign policy chief, and their Iranian counterpart followed an agreement between Iran and the International Atomic Energy Agency last week on resuming cooperation, including, in principle, the inspection of nuclear sites.
Several Western diplomats have said, however, that the accord is not detailed enough, sets no timeframe and leaves the door open for Iran to continue stonewalling.
There has also been no indication of a willingness from Iran to resume talks with Washington.
Iran says it is still refining how it will work with the IAEA.
In the call, Iran‘s Foreign Minister Abbas Araqchi expressed willingness to reach a “fair and balanced” solution, according to a statement on Iranian state media.
“The Islamic Republic of Iran has entered into dialogue with the International Atomic Energy Agency with a responsible approach … on how Iran will fulfil its safeguards obligations in the new situation … It is now the turn of the opposing parties to use this opportunity to continue the diplomatic path and prevent an avoidable crisis,” Araqchi said.
GERMANY SAYS IRAN HAS NOT MET CONDITIONS
Germany’s foreign ministry said on X that the E3 had “underscored that Iran has yet to take the reasonable and precise actions necessary to reach an extension of Resolution 2231,” adding that sanctions would be reimposed unless there were “concrete actions in the coming days.”
The sanctions would hit Iran‘s financial, banking, hydrocarbons, and defense sectors.
Four European diplomats and an Iranian official said before the call that the most likely scenario would be the E3 going ahead with a reimposition of sanctions.
An Iranian diplomat said Tehran had reiterated that it would retaliate if the decision to restore UN sanctions was made.
“The understanding in Tehran is that the UN sanctions will be reimposed. That is why Tehran refuses to give concessions,” an Iranian official said.
The West says the advancement of Iran‘s nuclear program goes beyond civilian needs, while Tehran says it wants nuclear energy only for peaceful purposes.