2021/22 budget includes VAT on foreign digital services
The Israeli Ministry of Finance has announced that it will revisit again taxing e-commerce goods and digital services being provided to its consumers by non-resident sellers or providers. Israel is on of the very few developed economies that does not bring non-residents into the VAT or GST net.
Presently, imports of goods are exempt from 17% Israeli import VAT if the consignment does not exceed $75. Above this, then either the foreign seller or their Israeli customer must pay import VAT to the customs authority. Check VAT Calc’s global VAT and GST on digital services tracker to see which other countries have introduced indirect taxes on electronic services to consumers.
What digital services are likely to be subject to VAT
Income from the following services to consumers is likely to be included in the non-resident VAT regime:
- Online advertising
- SaaS or cloud-based software
- Streaming and download music, video and films
- E-books and newspapers
- Dating websites and other membership-based sites
- Online gaming
Africa & Middle East VAT on digital services
| Comments (click for details) | Rate | Date | Threshold | Comments |
| Algeria | 9% | Jan 2020 | Nil | |
| Angola | 14% | Oct 2019 | – | |
| Bahrain | 10% | Jan 2019 | Nil | |
| Benin | 18% | Oct 2023 | TBC | |
| Cameroon | 19.5% | Jan 2020 | XAF 50 million | |
| Egypt | 14% | Sep 2016 | EGP 500,000 | |
| Ghana | 12.5% | Apr 2022 | GHS 200,000 | |
| Israel | 17% | TBC | – | Proposals withdrawn |
| Ivory Coast | 18% | 2022 | - | |
| Kenya | 16% | Sep 2013 | - | Registration threshold removed 2023 |
| Kuwait | 5% | Jan 2024? | - | TBC |
| Mauritius | 15% | 2020 | ||
| Nigeria | 7.5% | Jan 2020 | $25,000 | |
| Oman | 5% | Apr 2021 | OMR 35,000 | |
| Rwanda | 18% | TBC | ||
| Saudi Arabia | 15% | Jan 2018 | Nil | |
| Senegal | 18% | Jan 2023 | Nil | Fiscal representative required |
| Sierra Leone | 15% | SLE 100,000 | ||
| South Africa | 15% | Jun 2014 | ZAR 1 million | |
| Tanzania | 18% | Jul 2022 | Nil | Residents since Jul 2015 |
| Tunisia | 19% | Jan 2020 | Nil | Withholding VAT; 3% Royalty Tax |
| Uganda | 18% | Jan 2020 | UGX 150m | |
| United Arab Emirates | 5% | Jan 2018 | AED 375,000 | |
| Zimbabwe | 14.5% | Jan 2020 | Nil | |
| Zambia | 16% | 2024? |
