Choose Language
China United States United Kingdom South Korea India Pakistan Indonesia Vietnam Canada Japan Argentina France Australia Singapore Egypt

B2B Marketplace | Sign In | Join Free


Israel Duties, Taxes and Customs Procedures for IT Products

Israel's tariff/tax information, certification, tariff, documentation requirement, etc.

Israel Duties, Taxes and Customs Procedures for IT Products

Postby bridgat » Tue Nov 18, 2008 7:44 am

Duties, Taxes and Customes Procedures for IT Products IT
The following guidelines for the U.S. business traveler and the U.S. exporter of computer software and hardware to Israel are based on information given by the Israel Customs Authorities. For further information, U.S. business people may consult the Ministry of Finance website: http://www.mof.gov.il/customs/eng/mainpage.htm The site includes a detailed contact list for customs officials and a guide for inquiries to the Customs Authorities: http://www.mof.gov.il/customs/eng/guidef.htm.

Hardware
Computer systems as a whole or as individual components are exempt from customs and purchase tax. However, Israel levies seventeen percent Value Added Tax (VAT) on the computer system's invoice value.

Business travelers may enter a portable computer into Israel without payment of duties/taxes, no matter what software is loaded on the computer, including encrypted software. The traveler will have to declare the laptop to the Customs officials upon entry into Israel and deposit a bond of 17 percent over the estimated value of the laptop. The deposit will be returned to the traveler upon departure from Israel with the laptop.

Software/Services
Software is exempt from duties/taxes, with the exception of 17 percent VAT. Customized software is treated the same as packaged software.

Software sold with updates: the invoice accompanying the original software should specify the total cost of the software (the medium, e.g. CD, and the intellectual property) and the number of updates included in the sale. Upon arrival of each update, the importer shall present to the Customs Authorities the original invoice and a detailed letter from the supplier indicating that the update is part of the original sale.

Software licenses are not classified in HS4907 by the Israel Customs. Software licenses are not subject to import duties. They are, however, subject to withholding tax and VAT on services. The Customs Authorities levy 17 percent VAT over the value of the license as declared by the supplier on the invoice.

Software-related services, i.e. training, and set-up, relating to the sale of the software are subject to withholding tax and 17 percent VAT over the value of the service.

1. U.S. IT-solution providers are permitted to send personnel to Israel to set up
hardware/software-related systems.

2. The Ministry of the Interior issues special visas/work permits. U.S. companies
may apply for the permits at one of Israel’s consulates in the U.S. The application
will have to be accompanied by a letter from the U.S. company specifying the purpose
of the visit, the nature of the work, the location of the work and the time the
applicant will need to spend in israel to complete the job.

Internet
Currently, software delivered to the end-user over the internet is not taxed.
Software, which is sent to a distributor who has a license to produce and sell the software, and to press it onto a CD for sale in Israel, is taxed as follows: the software is subject to 17 percent VAT levied on the total cost (cost of the software plus the cost of the license) listed on the invoice.

Customs Procedures
Customs documentation includes invoice, certificate of origin, and the sales document to include specification of the software if more than one item is included on the invoice.
Currently, digital products sold over the internet are not taxed.
Israel has no foreign exchange restrictions.
Import of remanufactured parts for photocopiers, fax machines, laser printers and toner cartridges is permitted. Special labeling is required, as specified by the Ministry of Industry and Trade. The value shown on the invoice should be the value of the original, new equipment reduced by amortization. The Customs Authorities levy seventeen percent VAT over the value of the shipment as declared on the invoice.
Israel Customs have a special classification for re-imported, repaired computer equipment. The invoice should state the value of the repair, the cost involved in the two-way transportation of the equipment, and insurance. VAT is levied over the total cost listed on the invoice. The repair of the equipment is subject to customs and purchase tax only if the original equipment would have been subject to those taxes. While computer hardware is exempt, items such as fax modems, video cameras for computer systems, etc., which may also be used independently from the computer, may be subject to customs and purchase tax.

Senior Commercial Specialist Irit van der Veur will be pleased to assist U.S. firms requiring further information. She may be reached at tel: 972-3-519 7540, fax: 972-3-510 7215, e-mail: irit.vanderveur@mail.doc.gov

The following guidelines for the U.S. business traveler and the U.S. exporter of computer software and hardware to Israel are based on information given by the Israel Customs Authorities. For further information, U.S. business people may consult the Ministry of Finance website: http://www.mof.gov.il/customs/eng/mainpage.htm The site includes a detailed contact list for customs officials and a guide for inquiries to the Customs Authorities: http://www.mof.gov.il/customs/eng/guidef.htm.
bridgat
 
Posts: 1180
Joined: Thu Nov 13, 2008 12:51 am

Return to Israel

Who is online

Users browsing this forum: No registered users and 0 guests

cron