Israel Launches Pilot Program for Extortion Victims' Compensation

Israel's Tax Authority has initiated a pilot program to compensate business owners for direct property damage resulting from extortion. The program, based on a government decision, covers losses incurred between September 24 and November 23, 2026. Eligible recipients are entrepreneurs with legal businesses, valid licenses, and active tax accounts. Compensation is available if their property or home was damaged due to refusal to pay extortionists or after reporting the crime to the police.

To qualify, applicants must file a police report linked to extortion and demonstrate that they could not obtain insurance coverage for intentional damage, even with prior insurance, or were denied by their insurer. They must also have met risk protection requirements. For damaged buildings, proof of legal construction permits is necessary. Applications must be submitted to the Tax Authority's compensation fund within seven days of the incident via a dedicated online system, accompanied by all required documents.

Crucially, victims are prohibited from repairing damaged property before filing a claim and an assessment by the Tax Authority, as this could jeopardize their eligibility. Only the removal of debris is permitted. The compensation covers only direct damages, excluding indirect losses or harm to third parties. The maximum payout under this program is 2 million shekels, with application reviews taking up to eight months.