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Israel extends VAT to low-value imports

Withdrawal of Value Added Tax exemption on imports below $75

Israel is set to follow many countries be implementing VAT on low-value goods consignments sold to its consumers from 1 January 2022 at the earliest per the much-delayed 2021/22 budget from the Finance Ministry.  Any goods purchased from abroad are exempt from VAT up to a value of $75. They are also exempt from customs tariffs – except excise goods such as drink and tobacco.

It is likely that the Israeli Tax Authority will impose the obligation to charge sales VAT in the online checkout, instead of import VAT being due at the border. This may apply up to the same limit, $75, as customs duties.

The budget also includes a proposal to impose VAT on digital services provided from abroad.

Global withdrawal of low-value VAT exemptions

States around the world have been scrapping their import VAT exemptions on consumer purchases:

  • EU VAT e-commerce package ended the €22 VAT-free exemption in July 2021
  • New Zealand ended its GST exemption in December 2019
  • Australia ended its GST exemption in July 2018
  • Singapore will withdraw its exemption from January 2023
  • UK ended its £15 low-value VAT exemption from 1 January 2021

Completing Israeli VAT filings can be challenging.  VAT Calc’s single platform VAT Filer can accurately complete any country filings with verified transactional data from our VAT Calculator or VAT Auditor integrated tools.

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