Photo Credit: Asher Schwartz

The Knesset officially passed Finance Minister Yisrael Katz’s proposal to reduce real estate taxes to their previously lower levels.

Former Finance Minister Moshe Kachlon increased real estate purchase taxes to 8% (and to 10% above NIS 5,340,425) to discourage investors, in the mistaken belief this would lower real estate prices in Israel. All it did was send that investment money elsewhere. Kachlon succeeded in discouraging investors. He did not succeed in lowering real estate housing prices.


Katz’s proposal is likely to have investors once again looking at Israeli real estate.

The purchase tax for buyers buying their only home will remain the same:

NIS 0 – NIS 1,744,505:  0%

NIS 1,744,505 – NIS 2,069,205: 3.5%

NIS 2,069,205 – NIS 5,338,290: 5%

NIS 5,338,290 -NIS 17,794,305: 8%

NIS 17,794,305 and up: 10%

But on investment homes, the tax has been reduced to the following:

NIS 0 – NIS 1,292,280:  5%

NIS 1,292,280 – NIS 3,876,835: 6%

NIS 3,876,835 – NIS 5,338,290: 7%

NIS 5,338,290 -NIS 17,794,305: 8%

NIS 17,794,305 and up: 10%


Correction: The article has been updated with the correct numbers and for single home buyers.


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Naamit has been involved in Israel's Real Estate market for the past 20 years, selling new projects, Tama 38, 2nd hand homes, and home renovations - in Jerusalem, Efrat and Gush Etzion.