Starting 1st January, 2025, VAT will increase from 17% to 18%. This change will affect the price of all goods and services, except for fruits and vegetables and some services.

The VAT increase will immediately affect the cost of living. Stay aware of these changes and plan your expenses accordingly.

How does this impact us?

• Large Purchases: Buying a home worth 3 million shekels will incur an additional VAT cost of 30,000 shekels. Similarly, ordering a car worth 200,000 shekels that is not delivered before January will cost an extra 2,000 shekels.

• Rounded Increases: Many businesses are expected to round prices up. For instance, an item priced at 20 shekels may rise to 21 shekels instead of 20.20 shekels.

What do you need to know?
The applicable VAT rate is determined by the delivery or service date. For example, if you order a refrigerator in December but receive it in January, you’ll pay the new VAT rate. It’s advisable to make large purchases and complete payments before January 2025.

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