Israeli Treasury Extends Full Compensation for Northern Businesses Through May and June

Israel’s Finance Ministry and Tax Authority will extend the full compensation scheme for businesses in northern Israel for May and June 2026. The plan covers economic damage caused by the fighting in the region and continues aid beyond the earlier months of March and April.

Under the framework, businesses in frontier communities already qualify for full compensation under the property tax law, which can be approved by the Tax Authority alone. The new move also extends full aid to the broader “expansion areas” deeper inside the north, where business activity has been heavily disrupted. These include Upper Galilee, northern Golan Heights, Katzrin and Kidmat Zvi.

Eligible businesses in the north will be able to choose between two main compensation tracks depending on how they were harmed. The first is the turnover track, aimed at businesses with steep revenue losses, including tourism, hospitality and retail, and it compensates for lost net profit compared with the same period in a normal year. The second is the wage track, which reimburses employers who paid workers unable to come to work or actually work because of the security situation, road closures or school shutdowns.

The extension reflects the difference between May-June and the earlier March-April period. In March and April, the state operated a partial “eligible expenses” track for the entire economy, alongside the full scheme expanded for deep-north communities. Now that the nationwide program has ended, only northern frontier communities and the expansion areas remain eligible for full government compensation.