Israel plans 1% VAT rate rise to 18%
The latest budget, published this week, has unveiled an Israeli VAT rise. This increase is required to help reduce the government’s deficit.
The current Israeli VAT rate is 17%, following a 1% VAT rise in 2012. The new rate will be 18% from 31 May 2013. There will also be cuts to spending, including a reduction in government employee salaries by up to 3%, and reductions in defense spend. The VAT rise and proposed cuts will reduce the Israeli budget by 14bn shekels.