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Israel

#11 overall · Score 75.1 / 100 · up two places from 2025

Overall

#11

75.1 / 100

up two places from 2025

Corporate

#11

70.3 / 100

unchanged from 2025

Individual

#31

51.8 / 100

unchanged from 2025

Consumption

#11

73.4 / 100

unchanged from 2025

Property

#10

69.6 / 100

unchanged from 2025

Cross-border

#18

70.6 / 100

unchanged from 2025

Strengths

  • Net operating losses can be carried forward indefinitely and capital allowances are indexed for inflation.
  • The VAT rate is relatively low at 18 percent and applies to a relatively broad base.
  • Israel does not levy wealth or estate taxes.

Weaknesses

  • Israel has complex incentives that reduce the corporate tax rate to as low as 7.5 percent on certain technology companies.
  • The steep progressivity of Israel's taxes on labor leads to high efficiency costs.
  • Israel has a relatively narrow tax treaty network of 60 countries (the OECD average is 75), combined with high withholding tax rates on dividends, royalties, and interest.

Component Scores

Israel category scores out of 100Corporate Taxes: score 70.3, rank 11. Individual Taxes: score 51.8, rank 31. Consumption Taxes: score 73.4, rank 11. Property Taxes: score 69.6, rank 10. Cross-Border Tax Rules: score 70.6, rank 18255075100Corporate Taxes: 70.3 (rank 11)Individual Taxes: 51.8 (rank 31)Consumption Taxes: 73.4 (rank 11)Property Taxes: 69.6 (rank 10)Cross-Border Tax Rules: 70.6 (rank 18)CorporateIndividualConsumptionPropertyCross-border
Category Rank Score vs 2025
Corporate Taxes #11 70.3 unchanged from 2025
Individual Taxes #31 51.8 unchanged from 2025
Consumption Taxes #11 73.4 unchanged from 2025
Property Taxes #10 69.6 unchanged from 2025
Cross-Border Tax Rules #18 70.6 unchanged from 2025

Ranking Changes, 2014–2026

Israel's best overall rank was 11th and its worst was 17th. It ranks 11th in 2026.

Overall rank by year for IsraelIsrael: 2014 rank 17, 2015 rank 17, 2016 rank 14, 2017 rank 15, 2018 rank 15, 2019 rank 15, 2020 rank 13, 2021 rank 13, 2022 rank 13, 2023 rank 13, 2024 rank 12, 2025 rank 13, 2026 rank 112014201520162017201820192020202120222023202420252026Israel 2014: rank 17Israel 2015: rank 17Israel 2016: rank 14Israel 2017: rank 15Israel 2018: rank 15Israel 2019: rank 15Israel 2020: rank 13Israel 2021: rank 13Israel 2022: rank 13Israel 2023: rank 13Israel 2024: rank 12Israel 2025: rank 13Israel 2026: rank 11#17#11

OECD Context

Each row places all 38 countries on a 0–100 score scale for one measure. Israel is highlighted; the dashed line is the OECD median.

All 38 Countries' Ranks

Overall and category ranks for all 38 countries
CountryOverallCorporateIndividualConsumptionPropertyCross-border
Estonia#1#2#1#24#1#7
Latvia#2#1#8#22#4#6
New Zealand#3#31#7#1#8#14
Switzerland#4#7#9#4#36#2
Lithuania#5#3#10#23#6#16
Luxembourg#6#20#21#7#15#5
Czech Republic#7#9#4#32#5#11
Australia#8#29#14#9#3#23
Turkey#9#21#6#15#22#8
Hungary#10#5#3#38#23#4
Israel#11#11#31#11#10#18
Slovak Republic#12#24#2#33#7#17
Sweden#13#6#18#26#9#12
Costa Rica#14#35#13#6#11#29
Canada#15#17#28#8#25#28
Netherlands#16#23#30#14#20#3
United States#17#8#17#3#27#37
Austria#18#18#27#17#17#10
Germany#19#30#34#13#12#9
Norway#20#15#29#27#16#15
Mexico#21#28#26#12#2#38
Finland#22#10#24#28#21#24
Greece#23#22#5#29#30#19
Chile#24#32#23#10#13#36
Slovenia#25#14#12#30#24#30
Korea#26#26#38#2#31#34
Belgium#27#16#15#25#28#21
Japan#28#36#35#5#26#31
Ireland#29#4#36#35#18#27
United Kingdom#30#25#22#34#33#1
Denmark#31#19#37#20#14#32
Poland#32#12#11#36#29#25
Portugal#33#34#19#21#19#33
Iceland#34#13#32#19#34#26
Spain#35#33#20#18#35#20
Italy#36#27#16#37#38#22
Colombia#37#37#25#16#37#35
France#38#38#33#31#32#13

Across the OECD

Israel ranks 11th of 38 OECD countries on the overall index.

Source: 2026 International Tax Competitiveness Index.

Notes on the Data

The 2026 Index uses the most up-to-date data available as of July 2026. Data may not reflect changes in countries making rapid reforms.

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About the Authors

Alex Mengden Tax Foundation
Expert

Alex Mengden

Economist

Alex Mengden is an Economist at the Tax Foundation, where he focuses on international tax issues and tax policy in Europe. He holds a BA in philosophy and economics from the University of Bayreuth and an MSc in economics from the Ludwig Maximilian University of Munich.

Tax Foundation Staff

Luis Zarka

Transatlantic Tax Fellow

Luis Zarka was a 2026 Transatlantic Tax Fellow with the Tax Foundation’s Center for Global Tax Policy.

Media Contacts

Sarah Wilbur Tax Foundation Media Relations Contact

Sarah Wilbur

Communications Manager

Sarah Wilbur is Communications Manager at the Tax Foundation where she advances the organization’s institutional reach by developing its corporate communications and media programs.

Jesse Solis Tax Foundation

Jesse Solis

Vice President of Communications

Jesse Solis is Vice President of Communications at the Tax Foundation, where he leads the communications team and works to build coverage of Tax Foundation’s experts and their work across the globe. He joined the team in 2021 as Communications Manager and became Communications Director in 2024.