Tax system in Israel
Israel taxes residents on worldwide income through seven brackets from 10% to 50%, with credit points near ILS 2,904 yearly softening every bill. National insurance plus health add up to 12.17% at the top slice.
Residence turns on centre of life with day-count presumptions, and leavers face exit tax on deemed disposal. New immigrants and veteran returners keep a 10-year exemption on foreign income and gains.
Companies pay 23% with preferred tech lanes down to 6%, investors pay 25% or 30% on gains and dividends, and VAT is 18%. There is no wealth, inheritance or gift tax.
Tax rates at a glance
- Income tax
- 10% - 50%Progressive
- Wealth tax
- 0%
- Inheritance tax
- 0%
- Capital gains tax
- 25% / 30%
- Corporate tax
- 23%
- Dividend tax
- 25% / 30%
- VAT
- 18%
Who benefits most
These profiles tend to benefit most when the rules match their real residence, payroll and business setup.
EmployeesExpatsInvestorsFoundersCross-border groups
Watch out for
- Israel is not low-tax outside the oleh window. The 50% top rate plus 12.17% social layers makes top pay firmly high-tax.
- Centre of life decides residence, not just days. Keeping a home, family or business in Israel can preserve worldwide liability after departure.
- Post-2026 newcomers must file and disclose worldwide assets even where exempt. The reporting holiday survives only for pre-2026 arrivals.
- Capital income above ILS 721,560 carries an extra 2% surtax since 2025. Dividends, gains and rent stack 5% of surcharges at the top.
Frequently asked questions
Is Israel a high-tax country?
For top salaries, yes: 50% plus social charges. But new immigrants enjoy a 10-year foreign-income exemption, and tech companies reach 6% to 12%.
Does Israel have a wealth tax?
No. Israel levies no net wealth tax and no inheritance, estate or gift tax.
Which taxes matter most in Israel?
The main ones are progressive income tax with credit points, 23% corporate tax, 25% or 30% capital and dividend tax, national insurance and 18% VAT.