{"id":12808,"date":"2024-08-13T05:00:53","date_gmt":"2024-08-13T05:00:53","guid":{"rendered":"https:\/\/innovationisrael.org.il\/en\/?post_type=report&#038;p=12808"},"modified":"2024-08-13T09:51:30","modified_gmt":"2024-08-13T09:51:30","slug":"high-tech-contribution-to-state-revenues-report-2","status":"publish","type":"report","link":"https:\/\/innovationisrael.org.il\/en\/report\/high-tech-contribution-to-state-revenues-report-2\/","title":{"rendered":"2. Methodology: Measuring High-Tech&#8217;s Contribution to State Revenues"},"content":{"rendered":"\n<p><br><\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><br>According to the definition of the high-tech sector and of high-tech companies<\/h3>\n\n\n\n<p>There are several accepted approaches used to define the companies and employees of the high-tech sector in Israel. The definitions differ from each other in the number and type of companies they include. Consequently, there are also variations in the number of employees and their related payments. Furthermore, different methods exist for collecting data (administrative data which presents real figures as opposed to surveys which present estimates) and there are differences in the frequency that data is updated.<\/p>\n\n\n\n<p>In this report, we focus on two definitions of the high-tech sector to estimate its contribution to state revenues, while using administrative data. The first of these is the definition of &#8220;<span style=\"text-decoration: underline;\">the high-tech sector<\/span>&#8221; as accepted by the CBS. According to this definition, as of 2021, 13,837 companies reported employing workers, of which 309 were foreign companies, with a total of 285,000 full-time jobs (not including the communications sector). A second definition we use is that of technology companies and is based on SNC and IVC databases. 8144 companies are included in this definition, of which 552 are foreign companies, with a total of 255,000 full-time jobs (in 7,916 companies that reported employing workers). Throughout this report, we will refer to this definition as &#8220;<span style=\"text-decoration: underline;\">the high-tech companies<\/span>&#8220;.<\/p>\n\n\n\n<p><br><\/p>\n\n\n\n<h1 class=\"wp-block-heading has-large-font-size\">Evaluation of High-Tech&#8217;s Contribution<\/h1>\n\n\n\n<p><br>The definition of the high-tech sector we will use later in the report will be in accordance with the accepted international standards, with one main variation \u2013 we omit the communications sector and do not include it in the definition of the high-tech sector<sup class=\"modern-footnotes-footnote modern-footnotes-footnote--hover-on-desktop \" data-mfn=\"1\" data-mfn-post-scope=\"0000000000002bf30000000000000000_12808\"><a href=\"javascript:void(0)\"  title=\"Omitting the communications sector is in accordance with the recommendations of the Kandel Committee for improving the high-tech data infrastructure in Israel. The committee&#8217;s report can be seen here\"  role=\"button\" aria-pressed=\"false\" aria-describedby=\"mfn-content-0000000000002bf30000000000000000_12808-1\">1<\/a><\/sup><span id=\"mfn-content-0000000000002bf30000000000000000_12808-1\" role=\"tooltip\" class=\"modern-footnotes-footnote__note\" tabindex=\"0\" data-mfn=\"1\">Omitting the communications sector is in accordance with the recommendations of the Kandel Committee for improving the high-tech data infrastructure in Israel. The committee&#8217;s report can be seen <a href=\"https:\/\/www.cbs.gov.il\/he\/Documents\/%D7%93%D7%95%D7%97-%D7%95%D7%A2%D7%93%D7%AA-%D7%9E%D7%95%D7%9E%D7%97%D7%99%D7%9D-%D7%A1%D7%A7%D7%98%D7%95%D7%A8-%D7%94%D7%94%D7%99%D7%99%D7%98%D7%A7.pdf\">here<\/a><\/span>. The definition of the high-tech companies attempts to focus on and identify the high-tech companies operating in Israel according to important external databases. Appendix 1 includes detailed information about each of the definitions and the differences between them. In light of the limitation of the different figures in each definition, we will note which one was used alongside each analysis (the definition of &#8220;the high-tech sector&#8221; which represents the CBS definition or the &#8220;high-tech companies&#8221; definition that is based on the SNC and IVC databases). <\/p>\n\n\n\n<p>As noted, the most up-to-date information pertaining to tax payments in Israel available when this report was prepared refers to 2021, due to the timing of reports submitted to the tax authorities. Some of the segmentations are unavailable for this year and we have therefore used the most up-to-date data available for each analysis. If the most up-to-date year for analysis was the Covid year (2020), we have made every effort to add data about the long-term trend<sup class=\"modern-footnotes-footnote modern-footnotes-footnote--hover-on-desktop \" data-mfn=\"2\" data-mfn-post-scope=\"0000000000002bf30000000000000000_12808\"><a href=\"javascript:void(0)\"  title=\"Throughout this report, unless explicitly stated otherwise, the term &#8220;income tax&#8221; refers to income tax from salaried employees\"  role=\"button\" aria-pressed=\"false\" aria-describedby=\"mfn-content-0000000000002bf30000000000000000_12808-2\">2<\/a><\/sup><span id=\"mfn-content-0000000000002bf30000000000000000_12808-2\" role=\"tooltip\" class=\"modern-footnotes-footnote__note\" tabindex=\"0\" data-mfn=\"2\">Throughout this report, unless explicitly stated otherwise, the term &#8220;income tax&#8221; refers to income tax from salaried employees<\/span>.<\/p>\n\n\n\n<p><br><\/p>\n\n\n\n<figure class=\"wp-block-image size-large is-resized\"><img fetchpriority=\"high\" decoding=\"async\" width=\"1024\" height=\"849\" src=\"https:\/\/innovationisrael.org.il\/en\/wp-content\/uploads\/sites\/3\/2024\/08\/chart-1-1024x849.jpg\" alt=\"\" class=\"wp-image-12748\" style=\"width:750px;height:auto\" srcset=\"https:\/\/innovationisrael.org.il\/en\/wp-content\/uploads\/sites\/3\/2024\/08\/chart-1-1024x849.jpg 1024w, https:\/\/innovationisrael.org.il\/en\/wp-content\/uploads\/sites\/3\/2024\/08\/chart-1-300x249.jpg 300w, https:\/\/innovationisrael.org.il\/en\/wp-content\/uploads\/sites\/3\/2024\/08\/chart-1-768x637.jpg 768w, https:\/\/innovationisrael.org.il\/en\/wp-content\/uploads\/sites\/3\/2024\/08\/chart-1-1536x1274.jpg 1536w, https:\/\/innovationisrael.org.il\/en\/wp-content\/uploads\/sites\/3\/2024\/08\/chart-1.jpg 1554w\" sizes=\"(max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<p><\/p>\n","protected":false},"excerpt":{"rendered":"<p>According to the definition of the high-tech sector and of high-tech companies There are several accepted approaches used to define the companies and employees of the high-tech sector in Israel. The definitions differ from each other in the number and type of companies they include. Consequently, there are also variations in the number of employees [&hellip;]<\/p>\n","protected":false},"featured_media":12715,"parent":0,"menu_order":2,"template":"","report_year":[309],"geographic_location":[],"class_list":["post-12808","report","type-report","status-publish","has-post-thumbnail","hentry","report_year-high-tech-contribution-to-state-revenues"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v23.8 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>2. Methodology: Measuring High-Tech&#039;s Contribution to State Revenues - English Innovation Site<\/title>\n<meta name=\"description\" content=\"In this report, we examine the contribution of the high-tech sector and its employeesto the Israeli economy. The report is the result of collaboration between the InnovationAuthority and the Chief Economist Division in the Ministry of Finance. This analysiswas performed during the past year and includes, for the first time, an in-depthexamination of payments of income tax, corporate tax, and other revenues to thestate treasury related to work in high-tech. The report&#039;s objective is to provide a situation analysis of state revenues fromthe high-tech sector with the aim, among others, of adapting future governmentpolicy in this field.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/innovationisrael.org.il\/en\/report\/high-tech-contribution-to-state-revenues-report-2\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"2. 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