Inserting a real estate asset into a trust will not be subject to land appreciation tax or purchase tax

Canadian grandparents formed a trust with an Israeli trustee and their Israeli granddaughter as sole beneficiary of the trust. When the settlors transferred two apartments in Tel Aviv into the trust, the tax authority demanded from them land appreciation tax and purchase tax on the transfer.
The Land Appreciation Appeal Committee held that the inserting of a real estate asset into a trust will not be subject to real estate taxes. Unlike the Israeli Income Tax Ordinance, which exempts from tax donation of assets into a trust, the Israeli Land Taxation Law does not refer to trusts. Notwithstanding the foregoing, the law should be construed as meaning that the inserting of a real estate asset by a settlor of a trust into the trust is not deed a "sale" for either land appreciation tax and purchase tax and the date of the tax event will be postponed to the actual date of distribution or sale of the property.