• Mon. Feb 26th, 2024

Unicorn CEO to Stop Paying Taxes and Leave Israel over Judicial Overhaul

Feb 2, 2023

On Tuesday, the founder of one of the most successful tech unicorns in Israel, announced that he was leaving the country.

He also added that he would stop paying taxes in protest of the judicial overhaul planned by the new hardline government.

The founder

Tom Livne, the chief executive of Verbit, said that he was encouraging other tech executives to take the same approach.

In its latest funding round that was conducted in late 2021, the hybrid human and AI-based captioning and transcription software firm, had been valued at $2 billion.

He said that in the last few years, he had paid taxes worth tens of millions of dollars, and the taxes that his firm paid were worth hundreds of millions of dollars.

Livne shed some light on the rationale behind his decision. He said that the tech sector serves as the economy’s engine and when it starts to act like this, then they would be seen and heard as equals.

He added that he hoped that others would not only see him, but also follow his lead of not paying taxes in Israel and leaving the country because this would hurt the government the most.

The company

About 200 people are employed in Israel by Livne’s firm and it has 1,000 employees abroad. He had already begun to withhold investments in the country’s economy.

Verbit was launched in 2017 and more than 2,000 customers use its transcription services across the government, education, media, corporate and legal sectors.

Some of these include Kaltura, Stanford University, Harvard University, FOX, CNN and CNBC. Bezalel Smotrich, the Finance Minister, responded to Livne’s announcement.

He told Livne that they were brothers and hoped he would return. The minister said that they only had one land and they wanted to keep Israel democratic, economically prosperous and strong.

Other details

The previous week had seen the co-founder and CEO of another tech unicorn, Papaya, announce that it was also withdrawing its funds from the country.

The global payroll firm is also valued above $1 billion, but its CEO said that they were no longer certain about conducting international activity in the country, so they had to take this painful step.

The workers, executive and founders part of the tech sector in Israel have expressed their opposition to the judicial overhaul proposed by Justice Minister Yariv Levin for limiting the independent powers of the High Court.

In recent weeks, the business organizations, moneymakers and companies in the country have stepped up their efforts in voicing their concerns about the judicial overhaul.

They have asserted that it threatens Israel’s democracy and this would have serious consequences for the local tech industry, which is thriving.

Many are concerned that if the judicial system is weakened, then it would lead to uncertainty and reduce the possibility of foreign companies making investments in Israel.

This would eventually force both local and international businesses to abandon their operations in Israel and setup elsewhere.

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