Israel Grants 7% Tax Benefits to 64 West Bank Settlements Retroactive to January

Israel's Tax Authority announced on July 1, 2026, that residents of 64 settlements in the West Bank will receive a 7% tax benefit starting next month, retroactive to January 2026. This move follows the approval of legislation led by Finance Minister Bezalel Smotrich and Knesset member Tzvi Sukkot in coordination with the Yesha Council. Smotrich and Sukkot described the tax benefit as a correction of decades-long discrimination, noting that other threatened areas in Israel have long received tax incentives, while West Bank settlements had not.

In a video message to residents, Smotrich urged settlers to check if their community is on the list, obtain a residency certificate from local authorities, and submit it to their employer to receive the tax benefit retroactively starting from the beginning of the year. The Yesha Council chairman, Israel Gantz, welcomed the government's decision as an important step to strengthen settlements and support residents living under complex security conditions. However, he emphasized that the current 7% benefit is lower than the 14% or higher incentives given to northern and southern Israeli communities, pledging continued efforts for equal treatment.

Tzvi Sukkot, who initiated the legislation, called the decision a historic correction, stating that it ends years of political discrimination against West Bank residents. He affirmed that the state is now clearly recognizing the settlers as integral, honoring thousands of families living on the front lines protecting Israel's land. The tax benefits aim to provide tangible support to these communities amid ongoing security challenges.