Tax Authority Recommends Departure Tax Projected to Raise NIS 1.1 Billion a Year

The Tax Authority’s Planning and Economics Division has recommended a tax on flights departing Israeli airports, with charges based on aircraft weight and flight distance. A position paper reported on November 8 estimates annual revenue of NIS 1.1 billion, measured in 2025 prices. The recommendation comes ahead of discussions on the next state budget. The proposed charge would range from about NIS 1,300 for a domestic flight operated by an aircraft weighing up to 50 tonnes to about NIS 100,000 for a long-distance flight by an aircraft weighing more than 300 tonnes. The estimates put the increase in ticket prices at 4–5%. Estimated additional costs per passenger are NIS 12 on domestic routes, NIS 58 on medium-distance routes, principally to Europe, and NIS 274 on long-distance routes, including the United States and the Far East. The division’s stated rationale is to account for greenhouse-gas emissions, local air pollution and aircraft noise, alongside associated infrastructure and health costs. It favors the weight-and-distance model for its operational simplicity and the certainty it would give airlines about their tax liability. The report notes that international flights currently receive zero-rate VAT treatment and aviation fuel is exempt from excise. It also points to comparable aviation taxes in Britain, France and Germany. The reported paper is a recommendation for budget discussions; it does not establish an approved levy or an implementation date.