Category Taxation in Israel

Israel Enacts Surprise Tax Hike on Luxury Electric Cars

June 11, 2018 Taxation in Israel

TeslaTEL AVIV – Consumers buying luxury electric cars in Israel have received an unwelcome surprise in the form of a tax hike.

Over the weekend the Minister of Finance of Israel Moshe Kahlon announced that an order has been signed to hike the taxes imposed on the sale of luxury-level electric vehicles sold in the country.

Previously, electric cars bought in Israel would face a purchase tax of 20 percent, while hybrid vehicles would face a tax rate of 30 percent.

However, following the new order, the rate of purchase tax on both vehicles types will rise to 34 percent and 44 percent for electric and hybrid vehicles, respectively, for vehicles with prices exceeding ILS 300 000.

It is believed that high-end electric vehicles made up nearly half of all sales of electric cars and hybrid cars over t...

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Property Taxes Shut Doors of Church of the Holy Sepulchre

February 26, 2018 Taxation in Israel

Church of the Holy Sepulchre, Jerusalem, IsraelJERUSALEM – Property taxes and land sales are at the centre of a growing dispute at one of the holiest Christian sites in Israel.

A dispute is escalating in Israel between Church of the Holy Sepulchre in Jerusalem and the national and municipal government, with taxation being at the centre of the disagreement.

The current culmination of the disagreement was the temporary closure of the Church to visitors, which was done as a protest by the Church against its perceived mistreatment by the state.

New regulations which are being enacted would remove the tax break currently enjoyed by the Church on all its properties.

The Jerusalem municipal authority is claiming that church-owned businesses and property which are not used as houses of prayer should not be able to enjoy a break from local p...

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Israel Clarifies That Cryptocurrency is Not a Currency

February 20, 2018 Taxation in Israel

bitcoin taxTEL AVIV – Cryptocurrency will be taxed as an asset in Israel, meaning that miners will now be considered to be factories.

The Tax Authority of Israel has issued new guidelines on the taxation of cryptocurrency, confirming that profits made from coins will be subject to VAT and capital gains tax.

It was confirmed that cryptocurrency will be regarded as an asset and not a currency for the purposes of taxation.

Due to the consideration, any profits made from the use of cryptocurrency will fall under the scope of capital gains tax, levied at a rate of 20 percent to 25 percent.

Businesses involved in the sale of cryptocurrency or carrying out transactions with cryptocurrency will also face VAT on the transaction, however, that will not extend to private investors.

As cryptocurrency is to b...

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Israel Slaps Capital Tax on Bitcoins

January 16, 2017 Taxation in Israel

Cryptocurency in IsraelTEL AVIV – Transactions involving Bitcoins in Israel could be treated as barter transactions, and profits from coin sales could be charged a capital gains tax.

Late last week the Israeli Tax Authority issued a circular detailing the authority’s stance on the taxation of cryptocurrencies, saying that the Bitcoins and other cryptocurrencies shall be treated as assets when sold.

Cryptocurrencies are often considered to fall into a legal grey area for the purposes of taxation, with some countries classifying them as financial instruments, or currency, or an equivalent of a currency, or an asset.

The ITA has now decided that any cryptocurrency sold in Israel shall be regarded as the sale of an asset, and, subsequently, will carry a potential capital gains tax obligation.

The profits made fr...

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Israel’s Hunt For Ghost Apartments Not Succeeding

November 17, 2016 Taxation in Israel

Empty ApartmentTEL AVIV – Israel’s tax on empty property is not seeing the expected results, as authorities are unable to locate the empty apartment.

On November 15th the Knesset of Israel revealed that the new tax on “ghost apartments” has not had the intended effect, with only a small portion of taxpayers who should be required to pay the tax being made aware of their obligations.

Earlier this year the government of Israel enacted a new regulation which required that a taxpayer pays double the standard rate of property tax on vacant residential property.

The rate for these so-called “ghost apartments” is ILS 223.56 per square meter of the apartment.

It is estimated that there may as many as 48 000 empty residential apartments in Israel, with a significant portion belonging to overseas owners ...

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