Rafael Fines Regional Council Over 4.82 Million NIS Retroactive Property Tax
Rafael Advanced Defense Systems has petitioned the Beersheba District Court against the Hevel Eilot Regional Council over a retroactive municipal property tax demand of 4.82 million NIS for firing ranges and targets.
Defense technology company Rafael Advanced Defense Systems has filed a petition with the Beersheba District Court, sitting as an administrative court, against the Hevel Eilot Regional Council over a municipal property tax (arnona) demand totaling 4.82 million NIS for the years 2024 to 2026.
According to the legal filing, the regional council based its tax assessment on approximately 500 dunams classified as occupied land and 5,000 square meters of built space designated for offices, services, and commerce. Rafael argues that it does not hold any permanent assets within the council's jurisdiction, explaining that the area in question serves as a firing range utilized for periodic weapons testing, similar to other security entities.
Furthermore, the defense contractor contends that the structures cited by the council are merely targets stationed within the firing zones and that neither Rafael nor the state has ever been subjected to arnona levies for firing ranges. The central argument in the petition challenges the retroactive nature of the taxation, with Rafael asserting that the council has unilaterally altered a long-standing policy, violating Supreme Court rulings that prohibit retroactive tax enforcement.
In response to the dispute, the Hevel Eilot Regional Council rejected Rafael's claims in a letter sent on September 14, maintaining that company records indicate ownership and possession of the properties and placing the burden of proof on the taxpayer.
This southern legal battle follows a protracted financial dispute in the north regarding Rafael's David Institute. Since the area was geographically annexed to the jurisdiction of Kiryat Yam in 2018, Rafael has been embroiled in continuous legal wrangling with local authorities including Kiryat Yam, Acre, and the Krayot over municipal taxes and development levies. Although a compromise was reached in 2022 requiring Rafael to pay 50 to 52 million NIS, subsequent disputes over development charges culminated in an August ruling determining that Kiryat Yam had attempted to exact an unreasonable levy of 1.245 billion NIS.
