Q: So the idea was for the developer to roll over this discount, this benefit that the state gives to the residents?
A: That's right.
Q: Okay. And it is clear that if the developer continues to own the land, it thwarts the entire purpose of the project, if the discount is not rolled over to the buyer in the end, then it will thwart this entire project of Mehir LaMishtaken.
A: Of course."
- 308. At this point, it is also appropriate to address the respondent's arguments regarding the tender in Kiryat Ono, in which both "Buyer's Price" apartments were sold and apartments at free market prices, at a ratio of 80% to "Buyer's Price" apartments, as opposed to 20% to apartments on the free market.
I did not find any substance in the respondent's claims of artificiality in the distinction between the acquisition of lease rights in the free market apartments and the "buyer's price" apartments. All of the appellant's arguments in the appeals in this case are focused on the "Buyer's Price" tenders, in respect of which it was claimed that the appellant is not liable for purchase tax.
The appellant did not claim at all that she was not obligated to pay purchase tax in relation to the purchase of the rights in the land relating to the construction of the apartments on the free market. Nor is there any dispute that the appellant did not purchase the rights in the land on which the apartments were built on the free market at a reduced land price similar to the price at which the lands intended for the "Buyer's Price" apartments were sold.
- The fact that in one building in the Kiryat Ono project 80% of the apartments were built as "buyer's price" apartments and 20% of the apartments were built as apartments for sale on the free market does not create "artificiality", since it is clear that the price of the land paid by the appellant for the free market apartments is different; It is clear that the appellant is entitled to build the free market apartments in the specifications as it sees fit; may offer paid upgrades to buyers of free market apartments; The appellant is entitled to sell the free market apartments at the time she sees fit, or not to sell them if she does not want to sell, but rather to rent them or act in relation to them in any other way; and it is quite clear that the appellant is entitled to sell the apartments on the free market at a price as she sees fit and at her absolute discretion.
Even if the duration of the construction may be the same, given that it is the same building, it does not mean that from a legal point of view we are dealing with the same rights in relation to the land attributed to the "Buyer's Price" apartments as opposed to the land attributed to apartments intended for sale on the free market. As stated, the examination of whether or not we are dealing with the acquisition of a "lease" right within the meaning of the Real Estate Taxation Law is a substantive and not a technical one.
- The ILA's representative, Mr. Yaakov, also clarified in his cross-examination that there is a significant distinction between the two types of apartments (page 149, lines 11-23, page 150, lines 1-6):
"Q: Now look, you referred both in your affidavit and now to mixed tenders and I suggest to you that this difference that I mentioned, all these differences that we talked about between regular tenders, regular market tenders, exists not only between the tenders but also Even in a mixed tender, when you have apartments in the same tender of free and Mehir LaMishtaken apartments, then the exact same difference exists between the apartments that are sold in the tender according to the free market and the Mehir LaMishtaken apartments, do you agree with me?