Netanyahu not present as his political rival takes the stand

Lapid testifies at Netanyahu corruption trial: PM said Milchan tax law was ‘good’

Opposition leader repeats in court what he told investigators in Case 1000, that both Hollywood mogul and PM approached him about extending tax break for citizens who’d been abroad

Amy Spiro is a reporter and writer with The Times of Israel

Opposition leader Yair Lapid at Prime Minister Benjamin Netanyahu's corruption trial at the District Court in Jerusalem on June 12, 2023. (Yonatan Sindel/Flash90)
Opposition leader Yair Lapid at Prime Minister Benjamin Netanyahu's corruption trial at the District Court in Jerusalem on June 12, 2023. (Yonatan Sindel/Flash90)

Opposition leader Yair Lapid testified in court on Monday at the corruption trial of Prime Minister Benjamin Netanyahu about his interaction with the prime minister in 2013, when the Yesh Atid chief served as finance minister.

In his opening statement, Lapid reiterated what he had previously told police investigating Case 1000, in which Netanyahu is accused of attempting to grant a tax break to Hollywood mogul Arnon Milchan in exchange for lavish gifts from the billionaire tycoon.

“There were two occasions, once when we sat in Balfour [in the Prime Minister’s Residence], and one time at the entrance to the cabinet meeting” when Netanyahu asked Lapid about the situation in regard to Milchan, the current opposition leader testified.

Lapid said that Netanyahu asked him: “Did Milchan speak to you about the law?” and that he replied to the prime minister: “Yes, but I don’t think it’ll happen.” Lapid said that at the time Netanyahu replied to him offhandedly that it was a “good law.”

“It was in a very ‘by the way’ fashion,” Lapid testified in Jerusalem District Court, saying that the second occasion Netanyahu brought up the law was also in a similarly casual fashion.

Lapid said that prior to Netanyahu’s questions, Milchan and his attorney had approached him and requested that he look into “extending by another 10 years” the law that grants temporary tax immunity to returning Israelis who have spent time abroad.

Opposition leader Yair Lapid arrives to testify in Prime Minister Benjamin Netanyahu’s corruption trial at the District Court in Jerusalem on June 12, 2023. (Yonatan Sindel/Flash90)

The opposition leader said that the Hollywood mogul had attempted to convince Lapid that changing the regulation would “motivate Israelis to return to Israel and invest in Israel.”

But Lapid said that professionals in the Finance Ministry did not agree with this assessment.

Netanyahu’s chief defense attorney Amit Hadad repeatedly interrupted questioning by prosecutor Alon Gildin, referencing on several occasions the amount of press in the room and the attempt to politicize and sensationalize proceedings. Hadad accused Lapid of not fully remembering the conversations and discussions that took place in 2013.

Lapid’s presence in the courtroom on Monday added a jolt of political frenzy to the long ongoing proceedings in Netanyahu’s trial as the opposition leader testified in the criminal trial of the prime minister.

Netanyahu did not attend the proceedings in the Jerusalem District Court on Monday.

Producer Arnon Milchan accepts the Film Tribute Award at the 26th Annual Gotham Independent Film Awards at Cipriani Wall Street, on November 28, 2016, in New York. (Evan Agostini/Invision/AP)

Sources close to Lapid said the opposition leader showed up to testify on Monday in the same manner that any citizen would be required to if called as a witness by the court.

Prosecutors accuse Netanyahu of seeking to pressure Lapid to extend by a further decade an existing 10-year tax exemption for returning Israelis on income earned abroad — which could have saved Milchan millions of dollars.

Case 1000 centers around the claim that Milchan — a famed producer and Academy Award nominee — gifted the Netanyahu family cigars, champagne and jewelry in exchange for the prime minister’s attempts to aid him with his tax situation as well as with his efforts to attain a long-term US visa.

Lapid said in court on Monday that he worked for Milchan in Los Angeles for about six months close to 30 years ago, but that they were not close friends.

Prime Minister Ariel Sharon (left) shakes hands with Hollywood producer Arnon Milchan at a conference in the Galilee in June 2005. Finance Minister Benjamin Netanyahu is in the center. (Moshe Milner/GPO archive)

Milchan himself is expected to testify via video link from the Israeli Embassy in London starting next week. The court has ruled that Sara Netanyahu can be present during Milchan’s testimony in London, while her husband is expected to watch the testimony from the Jerusalem District Court. Milchan himself has not been charged in the case.

The prime minister faces charges of fraud and breach of trust in Case 1000 and in Case 2000, and charges of bribery, fraud and breach of trust in Case 4000. He denies wrongdoing and says the charges were fabricated in a political coup led by the police and state prosecution.

Netanyahu’s trial began three years ago, and according to the current schedule is slated to last for another five years, although some reports have said that the extensive witness list could be cut down.

Times of Israel staff contributed to this report.

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