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This country note provides an environmental tax and carbon pricing profile for Israel. It shows environmentally related tax revenues, taxes on energy use and effective carbon rates.
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The car tax in Israel has been historically the highest compared to any other country in the world, except for Denmark. The vehicle purchase tax was adjusted in 2005, 2009 and 2013. The Israeli experience sets a precedent for a tax that takes all pollutants into account.
Israel’s growing population and rising incomes have seen consumption increase substantially, bringing with it considerable pressure on the environment. One of the main environmental pressures is from the ever-increasing transport activity, especially the use of private vehicles. Although travelling in a private vehicle brings benefits to the individual using it, this entails costs to society as a whole.
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Despite a relatively good performance on several points compared to other countries, there is still scope for improving the effectiveness of Israel’s taxation policy from an environmental perspective.
Business brief. Overcoming the challenges of an arid climate and scarce natural water reserves has always been a vital necessity for the growth of Israel’s population and economy since the founding of the state. This has led to continuous improvements in Israel’s water sector, through innovations in technologies, practices and long-term plans.
The Government of Israel and the OECD co-organised an international conference on "Joining Forces to Develop Smart, Cost-Effective Urban Water Utilities: Policy, Economics, Environment, Regulation and Technologies" on 23 October 2013, in Tel Aviv.