Tax-Reduced Cars
Olim have rights to bring one vehicle (car or motorcycle) from any country within 3 years of their aliya. Cars of all sizes will be taxed at the same rate. Taxes are about 77% (instead of 127-144%) of the value at origin less depreciation plus shipping. Depreciation is about 20% for the first year and 10% for each year following to a maximium of 80% after 10 years. Olim can bring cars of any age or description, but they must be able to get the local commercial importer to give a letter stating that they are willing to provide service and parts (not necessarily quickly or free.) Olim must have acquired an Israeli license based on a valid foreign license. Returning residents have no tax reduction, but they do have the possibility of bringing in used cars up to 4 years old, compared to 2 years for normal Israelis.
Tax-Free Privileges for New Immigrants
As a new immigrant, you may bring three shipments of appliances and household goods into Israel TAX-FREE from ANY COUNTRY--- as of Jan 1, 2005, it no longer needs to be your last country of residence. Items brought with you on the plane are not considered as one of your shipments if you are receiving your teudat oleh (immigration certificate) at the airport. Olim can also buy an Israeli made refrigerator and air conditioner tax-free and import a car (any age) with a significant reduction in taxes. There are no longer rights on Israeli-made furniture.
Business Shipments and Bank Guarantees
Self-employed professionals or business people owning at least half of their operation are entitled to as much as $36,000 worth of professional equipment from any country tax-free, with a bank guarantee for the taxes. This will not be counted as one of the three personal shipments described above, but will require a bank guarantee. A bank guarantee is a time-limited letter from your bank to Customs guaranteeing payment if the goods are not installed in your home. Send it by registered mail to the Customs office with a copy of the guarantee. Call to make sure Customs notifies the bank to cancel the bank guarantee. These days it’s less often worthwhile to deal with tax-free business shipments, because taxes for industrial and office equipment tend to be limited to Vat, which businesses receive back from the government.
Tax-Free Privileges for Returning Residents
There are now two classes of returning residents, those who spent 2 years out of the country and those who spent 6 years out. Those who spent 6 years have the same rights as import/customs rights as new immigrants, except they have no tax reduction on a car. Rights include appliances and household goods. Those who stayed out for more than two but less than six years have rights for household goods only. Both categories of returning residents have rights for 2 shipments from any country within 9 months of their return.
Returning residents cannot have spent more than four months total in Israel each year. A new immigrant who spends six years in Israel after receiving his last tax-free shipment and leaves for two years can become a returning resident.
Bringing Gifts
Every person over 2, regardless of status, is entitled to bring in up to $200 worth of gifts each time you re-enter the country. If you are stopped by Customs, don't make the mistake of declaring that you are importing something as a new immigrant that you could have brought in as a gift, since this will be counted as one of your three shipments.
Time Limits and Extensions for Olim
Your goods must arrive in Israel within three years of your date of aliyah, i.e. the day you changed your status to oleh or temporary resident. This rule, however, does not apply to returning minors. If you served in the army (sadir) for at least six months, that time period will not be included in your three years of tax-free rights. Rights will also be frozen if you spend at least six months and a day uninterrupted out of the country following your change of status. If you enroll full time in a post-secondary school, college or yeshiva recognized by the Student Authority within 1 1/2 years of your arrival, your rights may be extended to one year after you finish your studies. The limit is 5 years of study. If you come as a tourist, your three years of rights usually begin when you change your status, unless you were a working tourist. This applies to shipping rights only. Check with the relevant authorities regarding other oleh rights, such as sal klita.
Clearing Date and Fourth Year Rights for Olim
Goods must arrive in Israel on or before the third anniversary of your change in status. They do not have to be cleared through Customs by that date, yet they must arrive in port. Customs allows an extension for one reason only: a shipping strike. Customs will usually grant permission to buy an Israeli-made refrigerator and air conditioner tax-free if you purchased or imported no major appliances during the first three years.
How Much Tax Will Be Charged for Late Shipments?
If your goods arrive late, you will be required to pay FULL TAXES. Though much has been made of the recent fulfillment of the Free Trade Agreement with the United States, there are no dramatic changes in tax levels, with the exception of refrigerators. No customs tax is charged on American-made goods shipped from America or European goods shipped from Europe providing they are accompanied by the proper certificate—but there is still vat and luxury tax to pay.
Those taxes are:
| |
Tax rates Without Certificate OF ORIGIN |
With C/0 |
| Refrigerator over 18 cu. ft. |
38% |
24% |
| |
|
|
TV/VCR/Stereo |
35% |
35% |
| |
|
|
| Oven/Washer/Dryer |
38% |
24% |
| |
|
|
| Microwave |
38% |
24% |
| |
|
|
| Dishwasher |
38% |
24% |
| |
|
|
| Furniture* |
31% |
17% |
| |
|
|
| Automobile** |
128% |
128% |
| |
|
|
Japanese cars are 144% |
|
|
| |
|
|
* The tax on used furniture: NIS 2 per Kg or 20% x value of shipment (+ ocean freight)-- the higher + 17% VAT. Inheritance shipments get a break of about 20% off that. If you're wondering how used furniture are valued, it's at $2/kilo. |
Taxes on appliances are levied on the sum of the price at origin, shipping and marine insurance.
When Oleh Marries Olah
When an oleh marries an olah who has used tax-free privileges within the last six years, their shipments are added together, with the permitted total remaining at three. The oleh can only bring in goods that his spouse did not. It is no longer valid that if your spouse used her rights over six years ago and spent the next six years in Israel, you have a complete set of rights. There still may be some leniency in this matter check with us first. If a shipment is arriving near your marriage date and you have a problem with overlapping purchases or too many shipments, your shipment must be cleared through Customs before you are married. A returning resident who marries an olah forms an oleh family with the full tax and customs rights.
How Many Appliances?
Olim are entitled to bring tax-free one of each of the following for home use: refrigerator, oven (double-decker or built-in with stove top), television, washing machine, stereo - tuner, amplifier, CD or turntable, cassette deck, and two pair of speakers or a home theatre speaker set, microwave, and dishwasher. Olim can bring in a dryer, freezer, and VCR or DVD. Olim can also purchase Israeli-made goods in these categories tax free, when available.
Household Effects and Carpets
Olim are entitled to bring: cooking utensils, pots, pans, flatware, china, dishes (everyday, fancy, Pesach each for meat, dairy and parve!), one musical instrument (no piano or organ for returnees), bedding, clothing, up to 50 recorded audio cassettes (20 videotapes), up to 200 records, jewelry and personal effects including as much furniture as is appropriate to their living space. Olim can also bring 30 meters of carpet tax-free if they are renting; if they own the apartment, they may bring up to 70% of the total area in wall-to-wall or 25% in area carpets. Note that the Customs Guide says 25% overall. Much depends on the port and customs agent.
Small Appliances
Olim have privileges on one of each of the following: computer (including monitor and printer), food processor, radio, vacuum cleaner, sewing machine, iron, bicycle, hair dryer, slide projector, knitting machine, coffee grinder, alarm clock-radio, vaporizer. Olim have rights on a toaster, toaster oven, mixer, citrus juicer, vegetable juicer, crepe maker, ice-cream maker, portable word processor, electric kettle, hand power tools, meat grinder, hot water urn, coffee maker, deep fryer, popcorn maker, espresso machine, rug shampooer, floor polisher, can opener, electric knife, answering machine, electric skillet, electric blanket, garbage disposal, hot water dispenser. Olim have rights to two or three of each of the following: fans, heaters, telephones.
[ PREVIOUS (Sample Contract) ] [ NEXT
(Tax Chart) ] 
