Israel

As of 2025, the portion of an individual's annual taxable income from capital sources (e.g. capital gains, real estate appreciation, dividends, interest, CPI linkage differentials, rental income, passive royalties) exceeding a certain threshold (721,560 Israeli shekels [ILS] in 2025) is subject to an additional surtax of 2%.

As of 2025, the standard value-added tax (VAT) rate in Israel increased from 17% to 18%.

In accordance with newly passed legislation, new immigrants and returning residents who become Israeli residents after 31 December 2025 are required to report their foreign source tax exempt income (see Other tax credits and incentives).