Tax Authority Director Calls to Abolish NIS 200 Banknote
Translated & summarized from Globes by baba
Tax Authority Director Shai Aharonovich has called for the abolition of the NIS 200 banknote and a broader reduction in cash usage. His renewed campaign, spurred by a recent report on Israelis holding NIS 129 billion in cash, aims to increase tax revenues. The Bank of Israel opposes these measures, despite a significant rise in cash circulation and ATM proliferation.
The story in 5 lines · by baba
- Tax Authority Director Shai Aharonovich wants to abolish the NIS 200 banknote and reduce cash use.
- Israelis are holding a record NIS 129 billion in cash, according to a recent report.
- Aharonovich believes eliminating cash could increase state tax revenues by NIS 20-30 billion.
- The Bank of Israel consistently opposes measures to abolish cash.
- Cash in circulation rose 3.5% in the first half of 2026, an annual pace of 7%.
Shai Aharonovich, Director of the Tax Authority, has reignited the campaign to reduce cash usage in Israel. Speaking at the annual Tax Consultants Association conference, Aharonovich proposed abolishing the NIS 200 banknote, and possibly all cash transactions. This renewed push appears to have been prompted by a recent Globes article highlighting that Israelis hold an estimated NIS 129 billion in cash. Despite consistent opposition from the Bank of Israel, Aharonovich is determined to eliminate the NIS 200 note, prioritizing it for action after the upcoming elections.
The article points to the case of Mital Saar, wife of the Mayor of Kfar Saba, where thousands of NIS 200 notes were reportedly seized, as a catalyst for Aharonovich's renewed focus. Data from the Bank of Israel indicates a significant increase in cash held by the public, reaching a record NIS 129 billion by the end of the first half of 2026. This is in addition to NIS 430 billion held in current accounts. The number of ATMs also continues to rise, with 9,150 units across Israel, a figure the Bank of Israel notes is relatively high compared to other countries and growing at an annual rate of 7%.
Cash in circulation saw a sharp 3.5% increase from January to June 2026, reflecting an annual pace of 7%. This follows a 2.6% rise in 2025 and a mere 1.3% in 2024, which had previously suggested progress in combating illicit cash. Aharonovich believes that eliminating cash could significantly boost state tax revenues, estimating an additional NIS 20-30 billion in collections, a figure he contrasts with the Bank of Israel's opposing stance.
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