Israeli oil and gasoline exploration partnership NewMed Vitality (TASE: NWMD), the largest associate within the Leviathan pure gasoline reservoir, is being required to pay extra tax of $198 million for the tax years 2019 and 2020, after the Israel Tax Authority discovered that the partnership’s taxable earnings was a whole lot of thousands and thousands of {dollars} greater than it reported.
NewMed Vitality (previously Delek Drilling) is a restricted partnership that was based in 1993 underneath an settlement between Delek Drilling Administration (1993) Ltd as a basic associate and Delek Drilling Trusts Ltd as a restricted associate, for the needs of finishing up oil and gasoline exploration and manufacturing in Israel. The partnerships participation models are traded at NIS 18.45, giving it a market cap of NIS 21 billion, after a 530% rise prior to now 5 years.
In its notification to the Tel Aviv Inventory Change, NewMed Vitality acknowledged that on the final day of 2025 it had acquired tax assessments from the Israel Tax Authority for 2019 and 2020 “towards a background of disputes that had arisen between the partnership and the Tax Authority and disagreements over the quantity of the partnership’s earnings for tax functions in 2019 and 2020.”
In its assessments, the Tax Authority decided that the earnings liable to tax from the partnership’s enterprise in 2019 was $406 million, as a substitute of the $170 million reported in its tax return, whereas its capital features have been $11 million, as declared.
The earnings liable to tax in 2020 was decided to be $370 million, as a substitute of the $87 million within the partnership’s tax return.
A query of interpretation
The primary dispute referring to the 2019 tax yr is over the interpretation of the best way wherein financing and different bills needs to be acknowledged. For 2020, the dispute is over that and over the timing of the popularity of expenditure on growth of the Leviathan reservoir.
If the Tax Authority’s claims are accepted, the partnership must pay taxes (plus curiosity and index-linkage) on the expense of its unit holders amounting to $90 million for 2019 and $108 million for 2020.
The partnership acknowledged that it disagreed with the Tax Authority’s stance, and that discussions have been going down not nearly 2019-2020 however about earlier years as properly. “The partnership has adopted an identical interpretation regarding issues in dispute from the 2016 tax yr to now. These issues are at present being clarified in authorized proceedings between the Tax Authority and the partnership regarding the tax years 2016-2018,” it stated in its notification.
In keeping with the partnership, a call on the matter is not going to have a dramatic impact on its complete tax legal responsibility over time, however fairly on the timing of tax funds.
On the idea of an opinion from its skilled advisers, NewMed places the possibilities of its arguments being accepted at over 50%, and it subsequently intends to file an objection to the tax assessments and to exhaust the executive and authorized proceedings accessible to it.
Revealed by Globes, Israel enterprise information – en.globes.co.il – on January 1, 2026.
© Copyright of Globes Writer Itonut (1983) Ltd., 2026.
