"By definition, ordering a product online from abroad turns us into 'small importers', and importing products to Israel is subject to import taxes: customs, purchase tax and VAT," says Adv. Rani Schwartz, an expert in customs and tax law and a partner at Yaron. Elder Fleur Schwartz & Co., ahead of this month's sales days.
Schwartz explains that customs is a tax imposed on the import of certain products from countries with which Israel does not have trade agreements.
For example, products imported from China may be subject to customs duties, while products imported from the EU will not be subject to customs duties.
Purchase tax is a tax imposed on certain products imported into the country or manufactured in the country, such as tobacco and alcohol products.
VAT is paid similarly to other import taxes at the time of release of the goods from customs control.
The law states that a private individual who carries out non-commercial imports of products worth up to $ 75 is completely exempt from import taxes.
We emphasize that this amount does not include shipping and insurance fees.
Advocate Schwartz explains that "for products priced at $ 500-75, there is an exemption from paying customs only but there is a charge for purchase tax and VAT, depending on the list of products and the purchase tax rate applicable to them. Taxable and if imported from China this product may also be subject to customs duty.
"A shipment in which the value of the product is between $ 1,000-500 is subject to the payment of import taxes. VAT will be paid with certainty, while purchase tax and customs duty depend on the product imported into the country and the identity of the country from which the import is made.
The tax is determined by the product classification, and each product has a different tax rate.
It matters whether the classification made to the product is appropriate and correct.
Proper classification can lead to significant tax savings.
Adv. Rani Schwartz, Photo: Tomer Jacobson
"A shipment valued at more than $ 1,000 is considered to be imported by a commercial importer, and in addition to taxation, additional provisions and restrictions will apply to it, such as an import license and a Standards Institution approval."
Is it possible to split shipments so that each one is worth the exemption?
"According to the tax authority, two or more packages sent from the same supplier to the same customer up to 72 hours apart will be considered as one split shipment, and import taxes will be calculated according to the total value of all products," Schwartz replies. The package, you can submit a request for clarification at the post office or an online request. "
Find out the restrictions
The recommendation is to plan in advance what is going to be purchased and find out on the website of the Tax Authority - where you can find a detailed guide, including a list of common products and tax rates that apply to all products.
In addition, you should check the "Customs Tariff Sign" on the website and find out the import restrictions.
According to Advocate Schwartz, "One of the most popular destinations for Israeli shopping was London, and it became less attractive after the abolition of VAT for tourists, starting on November 1, following the Brexit."
Meanwhile, last week came into force taxation on disposable utensils in Israel, which caused a dramatic jump in their prices.
Anyone who thought of ordering disposable utensils from sites abroad to evade the tax on them, may find that the transaction does not pay off. By ordering online, even under $ 75 is not exempt from purchase tax and VAT.
