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Steinitz: U.S. officials, Bill Clinton, lobbied against tax hike on gas developers

WASHINGTON (JTA) — Top U.S. officials, including former President Bill Clinton, lobbied hard against Israel increasing taxes on natural gas exploitation, Israel’s former finance minister said.

Yuval Steinitz recapped his four years in the finance job for the Israeli daily Maariv in a recent interview.

Steinitz, now the strategic affairs minister, focused on a centerpiece initiative under his leadership of the Finance Ministry that proposed raising taxes on companies hoping to exploit recently discovered offshore natural gas reserves.

The U.S.-based companies opposed any such hike, saying they had bought into the costly enterprise of exploring the region on the understanding that taxes would be low.

Steinitz said he faced a huge lobbying blitz.

"Pressure began from the White House," he said. "The energy companies hired American lobbyists, including former President Bill Clinton. who sent letters and had discussions to dismantle the Shashinsky Commission," the body Steinitz launched to examine the natural gas issue, "and to stop the tax law."

A JTA query to Clinton’s current office went unanswered.

"Members of the U.S. Congress asked me for clarifications," Steinitz said. "We began to feel a sense of pressure, as if we were doing something impeachable to commercial ties between the two countries. I tried to explain that we are among the countries earning the lowest rates from natural gas and petrol, that we get nothing and that the citizens of Israel have as much moral right to profit from public resources as do private companies."

Steinitz said the pressure decreased dramatically in the weeks after he published the Shashinsky recommendations for a tax increase in November 2010.

He said he understood from a "senior economic official" in the White House that the decision to pull back was President Obama’s. 

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