Israel Tax Authority set to publish voluntary disclosure plan

The Israeli tax authorities’ new voluntary disclosure procedure does not include anonymous tracks like in previous programs, but cryptocurrencies up to hundreds of thousands of shekels without demanding discussions with evaluators Includes fast “green” tracks to report profits. This is a procedure that appears to have been formed from the final discussion to develop a new voluntary disclosure procedure, and its publication is more than a year behind.

“Globes” also includes a new procedure specifically intended for cryptocurrency holders who have not previously reported profits, and the discretion of the assessment officer to disclose profits from digital assets is 5 million NIS total. I learned to be limited to. , and any amounts beyond this ceiling will require consultation and approval from the specialized department of the Israeli tax authorities.

For other financial assets, such as savings, income from assets, interest, and overseas deposits, the maximum disclosure limit for discussions with tax authorities is NIS 10 million. More than that, consultation with the specialized department is required.

2-3 billion NIS of funding

Voluntary disclosure procedures allow Israelis who have not concealed their hidden assets to report them to the state and be exempt from criminal proceedings and pay taxes. In May 2024, Israeli tax authorities Shei Ahalonovic announced that new voluntary disclosure procedures would be made public “within a few days.” Pay taxes without fear of prosecution. This is the third voluntary disclosure procedure that will be published to enable people operating primarily in the cryptocurrency market to report their income.

The state collected approximately NIS 153 million in the procedures ended in 2019, exceeding NIS 3.5 billion in the procedures implemented between 2014 and 2016. Estimates from the world and by Israeli tax authorities show that the new procedures were expected to bring NIS 2-3 billion to state funding, but months have passed and the new procedures were not made public.

The main contest that delayed the publication of the proceedings was the question of whether to include anonymous disclosure tracks. There, citizens kept their identity secret when they submitted their applications earlier, and only became clear after they were approved by Israeli tax. authority.

“Anonymous Track” was a major jump in the number of requests and disclosures in previous voluntary disclosure procedures. Therefore, 4,684 of the 7,615 requests submitted to the voluntary disclosure procedure ending in 2016 were submitted to anonymous tracks, and 520 of the 872 requests submitted to the 2019 proceedings submitted to I did.

The latest draft of the procedure is roughly the same as the previous voluntary disclosure procedure, except for one important change. There is no “anonymous track” in the procedure. After a lengthy discussion on the issue, the Israeli Tax Authority and the Ministry of Justice agreed that anonymous review of voluntary disclosures this time would be impossible and that disclosure applicants would be identified from the start.

Israeli tax authorities initially find that the absence of anonymous truck leads to applicants revealing their hidden wealth, due to fear that the state will act against them, if the process fails. I was afraid of that. However, the Ministry of Justice argued that citizens have already been given two opportunities to disclose wealth in the past, including the inclusion of anonymous tracks, this time through anonymous tracks. A tax authorities source told Globes that “there was a great sensitivity around anonymity issues and delayed the publication of new procedures, but now the discussion on the final formulation of a voluntary disclosure procedure is in the final stage. It’s on and there’s clearly no anonymous track.”

Cryptocurrency high speed trucks

Anonymous trucks have been cancelled, but green trucks are opened for cryptocurrency investors to report profits from digital assets to specific ceilings. The amount of ceilings has not been determined yet, but it only costs hundreds of thousands of shekels. This is a fast track that allows disclosure of financial assets only by submitting a report, without the need for a hearing with an evaluation officer.

Previous voluntary disclosure procedures included “short tracks” (which later became “green tracks”) and intended to report “small omissions”. NIS 500,000. In this situation, given the relatively small amount, citizens will disclose their income and profits and, after submitting their report, they will receive almost automatic approval of the application, and will be promptly approved. You can receive exemption from criminal proceedings in the process.

Published by Globes, Israel Business News -en.globes.co.il- February 17, 2025.

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