Israel Income Tax Brackets (2026)
Monthly income tax for employees from January 1, 2026
Employers normally withhold income tax from an employee's monthly salary. Israel uses progressive brackets: each portion of taxable income is charged at the rate for that bracket, rather than applying the highest rate to the entire salary.
For example, the first NIS 7,010 is taxed at 10%, and only the portion between NIS 7,010 and NIS 10,060 is taxed at 14%. Personal tax-credit points then reduce the calculated tax. In 2026, one monthly credit point is worth NIS 242.
This table covers income tax only. A payslip may also include National Insurance, health-insurance contributions, pension deductions, and other personal adjustments.
Israel salary tax brackets
| Bracket | Monthly taxable income | Rate | Maximum tax in bracket | Cumulative tax |
|---|---|---|---|---|
| 1 | From 0 ₪ To 7,010 ₪ | 10% | 701 ₪ | 701 ₪ |
| 2 | From 7,010 ₪ To 10,060 ₪ | 14% | 427 ₪ | 1,128 ₪ |
| 3 | From 10,060 ₪ To 19,000 ₪ | 20% | 1,788 ₪ | 2,916 ₪ |
| 4 | From 19,000 ₪ To 25,100 ₪ | 31% | 1,891 ₪ | 4,807 ₪ |
| 5 | From 25,100 ₪ To 46,690 ₪ | 35% | 7,557 ₪ | 12,364 ₪ |
| 6 | From 46,690 ₪ To 60,130 ₪ | 47% | 6,317 ₪ | 18,680 ₪ |
| 7 | On any additional amount | 50% |
VAT in Israel
VAT is a consumption tax included in most goods and services sold in Israel. Prices displayed to consumers generally include VAT, subject to the applicable law and exemptions.
Current VAT in Israel
The current VAT in Israel is 18% (Since the 1st of Jan, 2025)