Israel Tax Authority (ITA)
The Israel Tax Authority (ITA) is the Ministry of Finance agency that collects income tax, real estate taxes, VAT, purchase tax and customs. It was formed on September 1, 2004.
The Israel Tax Authority (ITA) is the Israeli government agency that collects income tax, real estate taxes, value-added tax (VAT), purchase tax and customs duties, and it operates as part of the Ministry of Finance. It was formed on September 1, 2004, by merging three separate tax bodies into one organization headquartered in Jerusalem.
Last updated: October 31, 2026
What Does the Israel Tax Authority Do?
The Israel Tax Authority assesses, collects and enforces most direct and indirect taxes in Israel. Its remit covers income tax, real estate taxation, VAT, purchase tax, customs and stamp tax, according to the authority's own description. It also runs criminal enforcement for significant tax offenses in VAT and customs and for basic offenses in income tax, VAT and customs.
When and Why Was the Israel Tax Authority Created?
The Israeli government decided on September 15, 2003, to unify its tax collection divisions, and the merger took effect on September 1, 2004. It combined the Income Tax and Real Estate Tax Department, the Customs and VAT Division and the Computerised Processing Service, known by its Hebrew acronym Sha'am. The stated aim was to place tax collection under one head manager authorized by law to apply the relevant tax laws.
Which Laws Does the Israel Tax Authority Administer?
The authority operates under several main laws, summarized below.
| Law or area | What it covers |
|---|---|
| Income Tax Ordinance | The primary law on income taxes in Israel, including capital gains |
| Land Taxation (Appreciation and Purchase) Law | Land appreciation tax and purchase tax on property deals, covered in the Mas Rechisha entry |
| Property Tax and Compensation Fund Law | Property tax and the compensation fund |
| Investment incentive laws | Tax benefits tied to capital investment encouragement |
Why Does the Israel Tax Authority Matter for Foreign Businesses and Olim?
The Israel Tax Authority is the body that applies Israeli tax rules to foreign companies, investors and new immigrants. For example, multinational companies that provide services to Israel through the internet, such as Google and Facebook, must pay VAT, according to Wikipedia's overview of Israeli taxation. Special tax incentives for new immigrants, covered in the Aliyah Tax Reform 2026 entry, are also administered through the tax system.
Frequently Asked Questions
What is the Israel Tax Authority?
The Israel Tax Authority is the Israeli agency responsible for tax collection, covering income tax, real estate taxation, VAT, purchase tax and customs. It is part of the Ministry of Finance.
When was the Israel Tax Authority established?
The authority was established on September 1, 2004, after a government decision in 2003 to merge the tax collection divisions.
Which bodies were merged to create the Israel Tax Authority?
The Income Tax and Real Estate Tax Department, the Customs and VAT Division and the Computerised Processing Service (Sha'am) were merged into one authority.
Does the Israel Tax Authority also handle customs?
Yes. The authority administers the customs tariff and the purchase taxes applied to imported goods.