Marketing grants now available for promoters of tourism

The Tourism Ministry has just published the procedures for obtaining grants from the Inbound Tourism Organizers Fund.

By LEON HARRIS
July 18, 2007 07:44
1 minute read.
taxes tourism 88 298

taxes tourism 88 298. (photo credit: Ariel Jerozolimski)

 
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The Tourism Ministry has just published the procedures for obtaining grants from the Inbound Tourism Organizers Fund. As its name suggests, this fund aims to support and expand inbound tourism into Israel in order to increase state revenues by providing ground arrangements in Israel for tourists from abroad. The fund offers grants of up to 50 percent of the actual outlays incurred on recognized marketing activities of inbound tourism organizers in the period from April 1, 2007 to March 31, 2008. The organizers are the commercial link in the chain who put together and market tourism packages in Israel for foreign tourists. The organizers must be Israeli companies whose principal activity is supplying travel agency services (as defined in the Travel Services Law 1976), which include services to foreign tourists. The fund may provide grants for the following activities: producing marketing materials; overseas flights; invitations to decision makers; exhibitions, seminars and events that promote tourism in Israel; overseas publicity; direct contact; Internet marketing; and marketing via overseas representatives. Additional conditions include that the company was active as an inbound tourism organizer in 2006; revenues from inbound tourism organizing in 2006 were at least NIS 2 million; and minimum marketing expenditure of NIS 100,000. Note that application forms for these grants must be submitted to the fund by August 1, 2007 - so hurry if you think you are potentially eligible. In addition, there are Israeli tax breaks and grants for hotels in Israel that qualify for "Approved Enterprise" or "Privileged Enterprise" status, pursuant to the Law For The Encouragement Of Capital Investments 1959. Company tax rates range from 0% to 25% and dividend withholding tax rates range from 4% to 15%. Fixed asset grant rates range up to 32% depending on location and other factors. (See the article: Your Taxes: Israeli tax breaks for business get even better" The Jerusalem Post, May 30, 2007). As always, consult experienced tax and legal advisers in each country at an early stage in specific cases. leon.harris@il.ey.com, sigal.griba@il.ey.com Leon Harris is an International Tax Partner at Ernst & Young Israel. Sigal Griba is a Tax Incentives Leader at Ernst & Young Israel.

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