Middle East
Israel: tax at a glance
Worldwide income is taxed on a progressive scale that tops out at 50%. The corporate rate is 23%, and new immigrants, known as olim, receive a 10-year exemption on foreign income.
Ways to relocate to Israel
The residency and citizenship routes that lead here, weighed against the tax picture above.
The taxes
- Personal income (top)
- 50%Rates are progressive up to 47%, plus a 3% surtax on income above ~ILS 721k. That brings the top marginal rate to 50%.
- Corporate income
- 23%
- Capital gains
- 25%, or 30% for substantial shareholders, plus a 3% surtax.
- VAT / VAT, known locally as Ma'am.
- 18%
- Dividends (WHT)
- 25%, or 30% for substantial shareholders.
- Interest (WHT)
- 15–25%
- Royalties (WHT)
- 23–25%
- Social security (employee)
- About 12%, combining National Insurance and health tax at the top bracket.
- Social security (employer)
- 7.6% at the top bracket.
- Wealth tax
- None
- Inheritance / estate
- None. Abolished in 1981.
- Property tax
- A municipal tax called Arnona, plus a progressive purchase tax called Mas Rechisha on acquisitions.
- Other
- A 3% surtax on high income, already included in the 50% top rate, plus an additional surtax on capital income starting in 2025.
How the system works
- Tax system
- Worldwide (residence-based)
- Foreign income
- Taxed (worldwide)
- Taxes by citizenship
- No
- Exit tax
- Yes, leaving has a cost
- CFC rules
- Yes
- CRS
- Participating
A special regime for new arrivals
New immigrants (olim chadashim) and senior returning residents get a 10-year exemption on foreign-source income and gains, under Amendment 168 from 2008. The reporting exemption itself was repealed by Amendment 272, effective 1 January 2026. Separately, a new regime running only through 2026 exempts Israeli-source active income up to a declining ceiling, for anyone arriving between 5 November 2025 and 31 December 2026.
The rates below are indicative headline figures (top marginal, standard, and headline rates), reviewed 2026-07. Brackets, surcharges, and state, provincial or cantonal taxes vary. Treat this as a reference map, not advice.
Sources (2)
Secondary references