Israel Delays Electric Car Tax Hike Until February Due to Elections
Translated & summarized from Calcalist by baba
Israel has postponed a planned increase in purchase tax on electric vehicles from January 1 to at least February due to upcoming elections. The delay, mandated by law concerning legislative expirations during election periods, will also affect "green score" tax adjustments and motorcycle tax reductions. The purchase tax on electric cars will remain at 48% until the new rates take effect in February.
The story in 5 lines · by baba
- Israel delays electric car purchase tax hike from January 1 to at least February.
- The postponement is due to upcoming elections and legislative rules.
- Tax reductions for "green score" vehicles are also extended to February.
- Motorcycle tax reductions will be extended until February 10, 2027.
- Current purchase tax on electric cars is 48%, on other new cars is 83%.
Israel will postpone a planned increase in purchase tax on electric vehicles until at least February, a delay attributed to the upcoming elections. The tax rate was scheduled to rise from the current 48% on January 1, with the new rate yet to be determined. This postponement is in accordance with a law stipulating that legislation set to expire within the final two months of a Knesset's term, or shortly after its dissolution or the start of a new one, remains in effect. Consequently, the purchase tax on electric cars is expected to remain at its current level until the end of February.
In addition to the electric vehicle tax, reductions and additions to purchase tax based on a vehicle's "green score" (emissions rating) will also be extended until February, instead of taking effect in January. Currently, non-electric new cars sold in Israel face an 83% purchase tax, with deductions applied based on the vehicle's pollution levels. These adjusted rates will now be implemented in February. Furthermore, tax reductions for vehicle safety accessories, which were not slated to change this year, will also come into effect in February.
The election-related delay will also impact the motorcycle sector. An existing temporary order, which reduced the purchase tax for two-wheeled vehicles with engine displacement not exceeding 125cc from 40% to 25%, will be extended until February 10, 2027. This measure has been renewed periodically since 2019.
