Israel ‘Attractive Destination’ for Russian Oligarchs, Legal Experts Say

Many wealthy Russians are keen on immigrating to Israel, as Turkey, UAE also vie for oligarch investment

With its unique tax benefits and lack of sanctions law, Israel is an attractive destination for Russian oligarchs and a growing number have expressed an interest in moving to the country, according to legal experts.

Pinhas Rubin is the chairman and the head of Gornitzky & Co., one of the largest law firms in Israel. The firm is very well-connected to oligarchs from Ukraine and Russia and has recently received inquiries from individuals wishing to move to Israel.

Israel is a tax haven not only for Ukrainians or Russians but for “the entire world,” Rubin told The Media Line. This is mainly because of a law that has been dubbed the “Milchan Law,” named after billionaire Arnon Milchan, which provides a tax exemption on overseas income for Jewish immigrants that are eligible under the Law of Return.

Rubin, who was one of the law’s primary architects, said that these tax benefits ultimately serve to encourage oligarchs to come to Israel.

“If a foreign national, whose business and fortune are abroad, immigrates to Israel and becomes a tax resident, he will not be taxed on his foreign assets and their income, or from their sale, for 10 years,” he said.

Rubin – who prefers to call wealthy individuals “activists of capital” rather than oligarchs, a term that he views as having overly negative connotations – believes that ultimately sanctions will not hinder them from immigrating to Israel because the majority are not on a US sanctions list.

“I really hope and expect, although it’s not a given, that when very wealthy individuals buy a huge villa here, they will have new friends and become part of the community in Israel,” Rubin related. “They’ll also invest in Israel. It will be a boon to the Israeli economy.”

In a meeting with Foreign Minister Yair Lapid on Sunday, US Secretary of State Antony Blinken said that the US appreciates Israel’s efforts to implement sanctions on Russia.

“We thank the foreign minister for his strong repudiation of Russian aggression against Ukraine and the Israeli promise that Russia will not be used as a backdoor for sanctions violations,” Blinked said, adding that the sanctions were an important measure intended to pressure the Kremlin into ending its aggression in Ukraine.

Blinken’s statements notwithstanding, Israel currently has no laws in place to implement the kind of sanctions that have been imposed on Russia by the West. The Israeli government has said that it will ensure the country will not be used as a tax haven for those seeking to evade them but has so far not gone into detail about its efforts in this regard.

In fact, the lack of a legislative framework is one of the primary reasons Israel is viewed as a particularly attractive destination for wealthy immigrants, according to Michal Khaikin, a paralegal at Nimrod Yaron & Co., a firm that helps new immigrants plan their taxes if they meet the conditions set forth by the Law of Return.

“Without a shadow of a doubt, Israel is a practical destination for oligarchs from around the world, including those from Russia, who are currently experiencing international sanctions,” Khaikin told The Media Line. “Currently, in Israel, there is no sanctions law that does exist in other countries, a law that taxes the policy of imposing sanctions and how they are implemented.”

Khaikin revealed that her firm had received several inquiries from Ukrainians and others in “ex-Soviet nations” requesting their services and counsel in the matter.