Purchase tax: the brackets frozen until January 2028

Every budget for an apartment purchase has a line buyers tend to fill in last, and it is precisely the line that decides whether the transaction is possible at all: purchase tax. It is not part of the apartment's price, it is not usually financed by the bank, and it falls due close to the purchase.

Until 2025 the purchase tax brackets were updated each year by the rise in the index. The Economic Efficiency Law for the 2025 budget year froze that update, and the Tax Authority published the brackets in execution instruction 1/2025. The effect of the freeze: the same nominal amounts continue to apply while apartment prices rise — pushing a growing share of transactions into the higher brackets.

A single residential apartment

In force from 16 January 2025 to 15 January 2028:

An additional apartment

In force from 16 January 2025 to 31 December 2026:

Note the difference in validity: the single-apartment brackets were published as applying until 15 January 2028, and the additional-apartment brackets until 31 December 2026. Before signing, verify the rate in force on the date of the transaction with the Tax Authority or its official simulator.

What the brackets mean in practice

1. The exempt bracket is an asset. For a single-apartment buyer, the first close to two million shekels are wholly exempt. That is the central gap between the two categories of buyer, and it disappears the moment a transaction is classified as an additional apartment.
2. The line is ₪6,055,070. The very same figure appears in both tables — for a single apartment as the step from 5% to 8%, and for an additional apartment as the step from 8% to 10%.
3. The freeze raises the bill quietly. When brackets are not index-linked, price rises alone increase the effective tax rate with no change in the law.

What to do before signing

1. Settle the classification in advance: single apartment or additional apartment. It is a question of fact worth hundreds of thousands of shekels.
2. Run the figure through the Tax Authority's official simulator and keep the output.
3. Make sure the tax is not budgeted out of the equity needed for the first payment to the developer.
4. Check the reporting and payment dates with a lawyer — late reporting carries its own exposure.
5. Examine whether any reliefs apply to your circumstances — a subject on which advice is essential rather than relying on a table.

Nothing here substitutes for legal or tax advice. Tax brackets change by legislation, and there are reliefs and classifications that no table captures. Before a transaction, take individual advice and verify with the Tax Authority.

Tax as part of structuring the transaction

Purchase tax is the item that explains why a payment schedule is not only a cash-flow question but a question of capacity: money paid in tax is not available for the first instalment. A buyer therefore plans both axes together — the stage-payment schedule explained in the article on the payment schedule, and the tax liability at the date of purchase. The site's planning calculators can be run alongside the official simulator.