Mair Linzen manages to chair both the largest law firm of Israel (Herzog, Fox & Neeman) and its best tax practice, as recognised by many independent reviews.
Links with Latvia
We started the conversation with a fact that not many in Israel now the Baltic states and Latvia, but there is a lot in common. Meir’s spouse is from Latvia and he told about a lot of significant connections between those two countries – it was a miracle how a person with Latvian origins helped to preserve Hebrew language, for example. Also, Latvian chocolate factory Laima belonged to a Jewish family before the World War. The government forced them to sell Laima and with that money the family established a similar factory in Israel – so their chocolate to a large extent has Latvian roots. Musician Mischa Maisky was born in Riga, and there are some good examples of Israeli politicians with the Latvian roots.
For your reading table
Meir has an extensive variety of interests besides the work – reading (non-fiction, especially on history), classical music, travelling. For your reading table Meir suggested Israeli writers Amos Oz, and two Nobel Prize winners in literature - Shmuel Agnon and Isaac Bashevis Singer.
Immigration boost to the economy
When about 1 million people came from the ex-Soviet Union when it collapsed many thought it will destroy the economy of Israel, but quite the opposite happened. Now the IT sector is booming to a large extent thanks to the 2nd generation of those immigrants.
Tax story
The tax story this time has a funny element – will not spoil the fun – you have to listen to it for yourself.
How fair is progressive income tax
We also discussed how fair is the progressive income taxation. Meir kindly shared his view that the more educated and paid have a certain responsibility for the less well paid. Also in the times like with the Covid-19 crisis the governments took most of the burden. In times like that the less educated are also less protected, have less choices. He explained this moral responsibility through his own example – professionals may work through a company and pay 23% on dividends, while the secretary would pay 35-40%. Thus Meir chose to work as an individual and pay 50% tax. Any country needs a well-functioning government, state defence, health-care and education systems. The balance of the progressive income taxation is that there is a rule of thumb that people should be left with at least 50% of their income.
On meaningful tax incentives
Post-war Seoul built a part of the city by granting tax incentives for moving there. Meir mentioned some examples of tax incentives in Israel that can impact behaviour – for those living in the periphery, for technological companies, big US multinationals that have presence in Israel pay only 4% of corporate tax.
Cat and mouse game will go on
Meir predicts that despite the latest transparency and fair taxation initiatives people and businesses will use their rights to pay as little tax as the law permits, with a help of creative tax lawyers. For the quality tax lawyers any structure so far already went hand in hand with its economic substance – in that sense the latest OECD initiatives are nothing new.
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