|Gov't Gas Revenues Could be Boosted by Billions of Dollars Following Civil Society Pressure|
Geologist Yossi Langotsky slammed the greed of the energy exploration companies at a conference organized by NIF.
When the Israeli government was considering whether to raise the royalties on a newly discovered natural gas field in the Mediterranean, the issue quickly became controversial. On one side, the energy companies who discovered the “Tamar” field insisted on maintaining royalties at their current 12.5% rate – the lowest in the developed world. On the other side, a coalition of civil society social justice organizations, led by NIF/SHATIL, insisted that a fair rate of return to the public coffers from the huge find could go a long way towards alleviating poverty and income inequality in Israel.
Appointed by the government, a committee led by Eytan Sheshinski examined the issues, and released its report last week – and they concurred with the New Israel Fund’s stance. If adapted, the Committee's recommendations will boost the state's coffers by billions of dollars
SHATIL's Programs Director Avi Dabush said that the success of the campaign so far has proved the vital importance of civil society in Israel and its ability to bring about significant social change."We made the difference by creating a climate in which public opinion strongly supported higher government revenues, and we passed on a lot of professional information to the Sheshinski Committee," Dabush said.
In a short period of time, SHATIL launched a coalition of 20 social change organizations to lobby for higher revenues and brief the media on the issue, organized a conference at Tel Aviv University on the topic, and set up a committee to hear views of professionals and summarize the information for the Sheshinski Committee.
At the Tel Aviv Conference in September, geologist Yossi Langotsky, who played an important role in the gas find, said, “The discoveries are intended to serve the State and its citizens. It is unbelievable how far people whose priority is making money will go in trampling the rights of all Israeli citizens to enjoy the benefits of the State’s natural resources.”
The Sheshinski Committee recommends keeping gas royalties at 12.5%, but also recommends introducing a new tax, which only kicks in after the gas exploration companies have recouped 150% of their investment, increasing gradually from20% to a ceiling of 60%. Estimates are that the new tax will earn the Israeli government $500 million annually on the Tamar gas field alone. This figure will become much higher if, as expected, even larger gas fields are discovered in the coming months.
The Israeli government currently receives only 30% of the profits of gas exploration companies compared with 50% in the US, 58% in Australia and 75% in Norway.
Ludicrous ads against NIF by a mysterious ultra-nationalist group say "Warning: NIF fights for Arab gas."
For supporting higher energy revenues for the public, NIF was the victim of a vicious and ridiculous attack by a mysterious right-wing group, which claimed that our position was an anti-patriotic plot to promote Israeli dependence on Egyptian gas at the expense of energy independence. The attack roundly backfired, especially after the Israeli media discovered that the funding source for the anti-NIF ad campaign was unidentified.
Although the Sheshinski Committee was appointed by Finance Minister Yuval Steinitz who supports its recommendations, the energy exploration companies have expressed fierce opposition to the new tax, and Prime Minister Benjamin Netanyahu has said he is not committed to implementing the recommendations.
An ad placed by NIF in Ha’aretz thanking civil society for its efforts in lobbying for higher revenues concluded, "The mission is not yet complete. Civil society now has the duty to ensure that the recommendations of the Sheshinski Committee are implemented and not buried by political wheeling and dealing behind the backs of the public. We will continue our efforts for a more just and equal Israel."