MERCAZ Newsletter - Spring 2004
Olim and Returning Citizens Lose Tax Benefits

According to newly adopted regulations of the Israeli Ministry of Finance, returning Israeli citizens will no longer be exempt from taxes on imported house appliances; nor will they or new immigrants be exempt from VAT on locally manufactured furniture. The new regulations also apply to cars, which will now be subject to 50% purchase tax regardless of engine size.

Olim and returning citizens will continue to be exempt from taxes on products which do not carry purchase tax (home utensils, carpets, furniture, clothing, etc.).

Only those entering the country after June 2004 will be subject to the new tax regulations.