Figures in the tax scandal

By SHARON FABIAN
Published: JANUARY 4, 2007 03:54
SHULA ZAKEN and YORAM KARSHI Considered a close associate of Prime Minister Ehud Olmert, Shula Zaken has worked with Olmert for 25 years. Zaken, 49, began as a secretary for Olmert in a private law firm, following him when he served as mayor of Jerusalem and as finance minister in Ariel Sharon's government. Zaken was appointed Olmert's bureau chief when he was elected prime minister last March. Zaken sets the prime minister's schedule and daily meetings, but her influence over Olmert is said to have waned in recent months. The police suspect that Tax Authority director Jacky Matza and his predecessor, Eitan Rub, accepted a bribe from Jerusalem local politician Yoram Karshi, Zaken's brother, in exchange for political appointments in the authority and tax breaks to private businessmen. Karshi, 44, a Likud member of the Jerusalem City Council considered close to MK Tzahi Hanegbi, is suspected of using his ties to Tax Authority officials and his sister to influence appointments in the authority. Karshi was one of three activists detained briefly in 2003 on suspicion of inflating voting lists in the Likud party primaries in Jerusalem the previous year. He was remanded by the Tel Aviv Magistrate's Court on Tuesday for eight days. After posting NIS 100,000 bail, Zaken was released on Tuesday night by the Tel Aviv Magistrate's Court to 10 days of house arrest. and barred from entering the Prime Minister's Office or leaving the country for the next 14 days. JACKY MATZA "I pledge to represent the simple tax payer whom I will defend against those who evade taxes." That's how Tax Authority director Jacky Matza presented his policy when he took office on December 28, 2005. He was appointed by then-finance minister Ehud Olmert, and the appointment was approved unanimously by the cabinet. Matza, 38, is an accountant by profession who studied law at university. He began working at the Tax Authority in 1993, taking a break between 1997 and 2000 to work in the private sector for an accountancy firm. Upon his return, Matza worked his way up, serving as deputy to Tax Authority director Eitan Rub from July 2004, when Rub oversaw the merger of the previous authority with the Treasury's Customs and VAT department. After being appointed director, Matza was credited with boosting cooperation among tax authorities and cracking down on debtors, which led inter alia to investigations into alleged money-laundering at Bank Hapoalim's Hayarkon branch. He also introduced a plan to reduce VAT to 15 percent in 2007. On January 1, at Matza's recommendation, Finance Minister Avraham Hirchson signed an order cancelling tax on wood used for furniture. At the beginning of this week, Manufacturers Association president Shraga Brosh gave Matza a special certificate for his work on behalf of industry and the business sector during last summer's war. The Tel Aviv Magistrate's Court on Tuesday remanded Matza for six days. EITAN RUB Eitan Rub, 46, earned a bachelor's degree in economics and statistics, but is suspected of with making his way up the Treasury ladder on the basis of his personal connections rather than his professional skills. Before being appointed director of the newly formed Tax Authority, Rub served in various positions in the Economic Planning Ministry and the Treasury, including a stint as spokesman of finance minister Yitzhak Modai in 1988. Rub later tried his hand in the private sector for nine years, and was the first director-general of the YES satellite company. He was appointed to head the Finance Ministry's Customs and VAT department in 2001, and took over the new Tax Authority in July 2004, serving under three finance ministers: Silvan Shalom, Binyamin Netanyahu and Ehud Olmert. Under his tenure, the Tax Authority initiated a long-term plan for reducing taxation that began in 2005, and streamlined the successful collection of back taxes in a series of special operations, earning him the title, "Netanyahu's bulldozer." He concluded his term as director of the authority at the end of 2005, when Amir Peretz was chosen to lead the Labor Party, and early elections were called. Rub was recently touted to take over from Zvi Livnat as chairman of Hadera Paper Mills. The Tel Aviv Magistrate's Court on Tuesday remanded Rub for three days.