The purchase tax brackets for homes and farms were updated by 10.99% on January 16, a change that benefits the public. The basis for the update is the Prices of Dwellings Index published by the Central Bureau of Statistics. The change in the purchase tax brackets reflect the change in this index during most of 2008, although the rise slowed in the final months of the year.
A homebuyer who does not own another home will now be exempt from purchase tax up to NIS 1,026,660, up from the previous threshold of NIS 907,700. A homebuyer who does not own another home includes a person who owned a home up to the purchase date that will be sold within 24 months.
The purchase tax on a home costing between NIS 1,026,660 and NIS 1,442,870 will be 3.5%, paid by the buyer, up from the previous bracket of NIS 907,700 to NIS 1,275,690. The purchase tax on a home costing more than NIS 1,442,870 is 5%, up from the previous bracket of NIS 1,275,690.
A person who bought an apartment for NIS 1.5 million before January 15 paid NIS 24,096 in purchase tax, but will now pay NIS 17,424, a saving of NIS 6,672. A person who bought an apartment for NIS 1 million this week will now pay no purchase tax, compared with a levy of NIS 3,231 last week.
The 0.5% purchase tax bracket for new immigrant homebuyers was raised from NIS 1,165,670 to NIS 1,318,400. New immigrants will pay 5% purchase tax on a home above this threshold.
Published by Globes [online], Israel business news - www.globes-online.com - on January 19, 2009
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