Israel's hastily introduced corporate tax law is imposing a heavy burden on boutique law firms while offering lucrative opportunities for larger partnerships that offer tax advisory and restructuring services.

The so-called Trapped Profits Law, effective January 1, targets private companies with retained earnings, encouraging them to distribute profits as dividends in a change expected to raise NIS 10 billion ($2.7 billion) in revenue for the tax authority. Previously, Israeli companies paid a 23% corporate tax and a 30% tax on dividends in a two-tiered system, but many withheld profits for passive investments.