Israel Lowers Diamond Sector’s Risk Rating

RAPAPORT… The Israeli government has cut the risk rating of the country’s diamond industry in a move the sector has billed as a recognition of its improved transparency and compliance.

A November report by the authorities for tax and anti-money laundering cited steps the industry had taken to reduce risk, the Israel Diamond Institute (IDI) said Tuesday. These included a tax settlement between the sector and the government, the adoption of anti-money laundering guidelines by the Israel Diamond Exchange (IDE), and “positive results” of inspections by the government’s diamond controller, who regulates the trade.

As a result, the sector has received a “medium” risk score of 2.7, down from a “high” rating of 3.7, the IDI added.

“We see this as a vote of confidence in the Israel diamond industry and a step towards the establishment of a free-trade zone in the Israel Diamond Exchange,” noted Boaz Moldawsky, the IDE’s president.

The IDE has been calling for the introduction of a duty-free area within the bourse to enable foreign companies to transact with locals without paying income or corporate tax. Last week, the Ministry of Economy and Industry and the Israel Tax Authority announced they would set up a team to look into the matter.


Image: Traders in the Israel Diamond Exchange. (Three Photographers)