How Does Taxation Work?
Amazon automatically calculates and adds taxes to your order, transferring them to Israeli tax authorities. Taxes that may apply:
- VAT (18%)
- Import duty (customs)
- Purchase tax (on specific categories)
Thresholds — When Do You Pay?
VAT — Over $75
VAT is charged on orders exceeding $75 (including shipping costs). The amount includes all items in the package — so splitting orders may not help, as Amazon tends to consolidate packages.
Customs Duty — Over $500
Import duty is added to orders exceeding $500. The rate varies by product category.
Purchase Tax — Specific Products
Applies to certain categories like entertainment electronics. Full details on the Israel Tax Authority website.
Alcohol & Tobacco — Always
VAT on alcohol and tobacco applies to every purchase, regardless of amount.
What to Know
- Amazon calculates tax based on the original product price + shipping (not sale prices)
- If Amazon undercharged — you won't pay the difference. Lucky you
- If Amazon overcharged — you'll automatically receive a refund for the excess. Read more about Import Fees Deposit
- These guarantees apply only to products bought directly from Amazon (Fulfilled by Amazon). Third-party sellers may have different policies
⚠️ Warning About Splitting Packages
You can try splitting orders to stay below the VAT threshold ($75), but:
- Amazon usually consolidates packages for efficiency
- If caught (especially with Israel Post deliveries) — you'll pay tax plus a penalty
- Better to plan orders wisely than try to game the system
Tip: orders up to $75 (including shipping) = no VAT. Plan accordingly!