Real Estate Taxation (Appreciation and Acquisition) Bill (Amendment - Purchase Tax Brackets for a Single Apartment) (Temporary Provision - Swords of Iron), 5784-2024

This bill establishes a temporary provision for a period of one year, starting from its effective date, which will change the purchase tax brackets for a single apartment. The change is intended to provide relief to single-apartment buyers, particularly during the war and the special economic situation. According to the proposal, an Israeli resident purchasing a single residential apartment will pay purchase tax at the following rates, depending on the value of the apartment purchased: Up to a value of 2,500,000 New Shekels: no tax will be paid. On the portion exceeding 2,500,000 New Shekels and up to 3,000,000 New Shekels: a tax rate of 3.5% will be paid. On the portion exceeding 3,000,000 New Shekels and up to 4,500,000 New Shekels: a tax rate of 5% will be paid. On the portion exceeding 4,500,000 New Shekels and up to 15,500,000 New Shekels: a tax rate of 8% will be paid. On the portion exceeding 15,500,000 New Shekels: a tax rate of 10% will be paid. The proposal notes that purchase tax brackets have been updated in recent years only in accordance with the Consumer Price Index, and not in accordance with the rise in apartment prices. As a result, the amounts stated in the law, from which a purchase tax exemption can be granted, no longer reflect the price of a standard apartment, and many buyers are forced to pay purchase tax on the apartments they purchase, even though the law was intended to exempt them. The proposed amendment is intended to incentivize transactions in the housing market and provide relief to single-apartment buyers and those upgrading their housing.

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