Israel – Buying or Importing a Car

How do I buy a new car in Israel as a foreigner?

Acquiring a car in Israel is a costly undertaking due to the country’s substantial vehicle taxation, with permanent residents subject to a levy that can come close to doubling the price of a new car. This tax burden sets Israel apart from most other vehicle markets worldwide, where purchase taxes typically represent only a fraction of a car’s retail value. Establishing your precise tax status before setting foot in a showroom is therefore a critical first step.

Olim (new immigrants) and non-permanent residents holding an A/2 student visa may qualify for reduced tax rates. Olim are entitled to a concessionary rate when purchasing a new car within three years of making Aliyah. After five years have elapsed, no repayment of the tax reduction is owed; however, should the car be disposed of before that five-year threshold, the tax saving must be repaid in full.

If the buyer does not yet hold an Israeli licence, they must obtain an “89 number” in order to place an order (hazmanah) for the vehicle. The 89 number is a temporary identification number issued by Misrad Harishui (the Licensing Bureau) and can additionally be used as a basis for obtaining an Israeli driver’s licence. No prior appointment is needed to receive an 89 number.

The documents typically required when purchasing a new car in Israel as a foreign national include:

• A valid passport (with your Israeli visa if applicable)
• A copy of your Teudat Zehut (Israeli ID card, if you hold one)
• A copy of your Israeli driver’s licence (acquired via conversion of a foreign licence), plus your original licence from your country of origin, which must have been issued at least three months before your arrival in Israel
• Proof of address in Israel
• Bank details for any financing arrangements

Completing a purchase requires a substantial down payment. Once this has been made, the dealer will prepare documentation setting out the car’s value and the taxes payable. The dealer then forwards all paperwork to Meches (the Customs Authority), and within ten days to three weeks the vehicle should be released to you, together with any applicable reduced-tax benefit.

Holders of an A/2 student visa are not required to pay import tax at the point of purchase; instead, they may defer this liability until the car is eventually sold or scrapped. Because import tax is calculated on the vehicle’s value at the time of payment, deferring it can generate considerable savings through depreciation. To be eligible, the buyer’s visa must remain valid for at least one year from the date of purchase.

Financing options available to expats tend to be more restrictive than those offered to permanent residents, and many foreign nationals are required to provide a sizeable cash deposit or settle the purchase in full. Clarify your financing eligibility directly with the dealership and your bank before making any commitment. For the most up-to-date tax rates and eligibility conditions, refer to the Israel Tax Authority and the Ministry of Transport and Road Safety.

How do I buy a used car in Israel?

A number of secondhand dealerships decline to sell vehicles to foreign buyers because of the additional administrative requirements involved, so it is prudent to confirm in advance whether a dealer is prepared to assist non-Israeli purchasers. Private sales are an option but bring their own complications, particularly the necessity of thoroughly verifying a vehicle’s legal and financial standing before any money is exchanged.

Before purchasing any used vehicle — whether privately or through a dealer — you should carry out the following checks:

• Confirm the vehicle’s registration status and ensure it has a valid rishayon rechev (vehicle registration document)
• Check for any outstanding fines, road tax arrears, or liens through Misrad Hatachbura (the Ministry of Transport)
• Review the vehicle’s accident history — consider engaging an independent mechanic or automotive consultant to conduct a pre-purchase inspection
• Verify that the seller is the registered owner and that the vehicle is not subject to an outstanding finance agreement or court order
• Ensure the odometer reading is consistent with the vehicle’s recorded service history

Israel has a used-vehicle price guide — published monthly by Yitzchak Levy — that is broadly equivalent to the blue-book guides found in other markets (such as CAP in the UK or Kelley Blue Book in the United States). In practice, however, market prices in Israel frequently exceed the guide values, making local knowledge particularly valuable when assessing what a fair price looks like.

To navigate the secondhand market successfully, many seasoned buyers suggest working with an automotive consultant — a specialist whose role is to identify the best-value used vehicle to match your requirements. This can be especially helpful if you are unfamiliar with local market conditions or are conducting the transaction in a second language.

At the time of sale, the seller must hand over the original rishayon rechev (vehicle registration document). Both parties are normally required to attend Misrad Harishui in person to complete the ownership transfer. An Israeli citizen may instead grant a power of attorney rather than appearing personally. An appointment at Misrad Harishui is required for the transfer — bookable by dialling *5678 or through govisit.gov.il.

Ownership transfers may also be processed at certain large dealerships or at a post office branch, for a modest fee. If purchasing without Oleh benefits, the buyer and seller attend any post office together with the vehicle registration certificate and pay approximately 235 NIS, or alternatively complete the transfer online via the personal profile section of the Misrad Hatachbura website for approximately 222 NIS (as of 2024). Always confirm current fees with the Ministry of Transport and Road Safety.

Note that Oleh tax benefits cannot be applied when buying a used car through a private sale. That said, olim may still exercise their benefits to purchase an additional new vehicle or a “passport-to-passport” car within three years of Aliyah.

Can I import a vehicle into Israel, and how does the process work?

Importing a car is a detailed undertaking that should only be embarked upon after thorough investigation of the associated costs and practical implications. Israel is a left-hand traffic country using left-hand drive vehicles — consistent with continental European practice — meaning vehicles from other left-hand traffic markets are generally compatible. Right-hand drive vehicles (originating from markets such as the UK, Japan, or Australia) are not approved for use on Israeli public roads, which is a crucial point for anyone relocating from such countries.

Generally speaking, vehicles manufactured in compliance with the safety and environmental requirements established by European Community directives, as mandated for new vehicle types and registrations across EC member states, are eligible for importation into Israel, provided specified date conditions are met. Israel’s mandatory vehicle access requirements draw on the standards of the European Union, the United States federal framework, and Canadian vehicle regulations, encompassing technical inspections and regulatory testing requirements.

From 1 January 2025, the importation of new vehicles carrying EU whole vehicle type approval (WVTA) with a production date after 7 July 2024 will only be permitted if the vehicle manufacturer confirms that vehicles destined for Israel are equipped with an ISA (Intelligent Speed Assistance) system configured for use in Israel.

Olim are entitled to import one vehicle under their reduced-tax Oleh benefit, which may be a car or a motorcycle. This entitlement must be used within three years of the date of Aliyah. Extensions are available to those who serve in the IDF during this period, pursue studies at a recognised Israeli university, or spend more than six consecutive months abroad.

The step-by-step process for importing a vehicle into Israel is as follows:

1. Confirm eligibility: Establish whether you qualify for reduced-tax benefits (for example as an Oleh) and whether your vehicle satisfies Israeli safety and emissions standards (EU, US federal, or Canadian standards).
2. Appoint a licensed customs agent: A local customs agent (Meches agent) will manage the clearance documentation on your behalf. Given the complexity involved, this step is strongly advisable.
3. Obtain an import permit: Apply for an import permit through the Ministry of Transport and Road Safety.
4. Ship the vehicle: Arrange international freight. Most marine insurance policies require a statement of condition to be signed by both the packers and the customer. Verify that the vehicle is adequately insured throughout transit.
5. Gather required documentation: To release the vehicle through Meches, you will need all documentation required to activate your Oleh benefits (Teudat Oleh or Teudat Zakaut, Teudat Zehut, foreign passport with Aliyah visa and Israeli passport where applicable), a valid Israeli driver’s licence, a valid foreign driver’s licence, and a bill of lading, invoice, and certificate of conformity.
6. Pay import taxes: Once the vehicle reaches Israel, the applicable import taxes must be settled — or deferred if you are eligible. Your customs agent will calculate the sums due.
7. Undergo a standardisation check: This inspection is designed to confirm the vehicle’s identity against the accompanying documents and to verify compliance with Israeli standards. After the Personal Imports Division of Misrad Hatachbura is notified of the vehicle’s release, you will receive an invitation to attend the standardisation check — normally within two weeks of arrival, though the check itself may take up to two months to complete.
8. Complete registration: Following a successful standardisation check, proceed to register the vehicle with Misrad Harishui (the Licensing Bureau).

The imported vehicle is intended for the personal use of the Oleh and their spouse. This restriction remains in force for four years from the date of import, after which it is lifted automatically.

The principal government bodies overseeing vehicle imports and customs in Israel are:

• Israel Tax Authority (Customs Directorate / Meches) — responsible for assessing and collecting import duties and handling customs clearance
• Ministry of Transport and Road Safety (Misrad Hatachbura) — issues import permits and oversees vehicle registration and standardisation checks

What are the costs involved in importing a car to Israel?

The overall expense of bringing a vehicle into Israel can be very significant — often far exceeding the equivalent process in countries such as those within the EU single market, where vehicles moving between member states incur no import duty. Careful budgeting across multiple cost categories is essential.

For standard residents, the combined tax burden on vehicles can approach 100% of a car’s value, though new immigrants benefit from substantial concessions. These taxes are not a single flat charge but are instead structured in layers, each with its own calculation method.

Israel calculates import taxes using the CIF (Cost, Insurance, Freight) method, meaning that the taxable base includes the purchase price of the goods together with the cost of shipping and insurance. This differs from countries that apply duties to the FOB (Free on Board) value alone, with the practical consequence that your shipping costs themselves contribute to the total tax liability.

Given the intricacy of Israel’s vehicle tax framework, it is strongly recommended to engage a licensed customs agent and to use the official tax calculator provided by the Israel Tax Authority to estimate costs before committing to an import. All figures should be cross-checked against current official rates at the time of your move, as tax rates and surcharges are subject to revision.

How do I register a vehicle in Israel?

Vehicle registration in Israel falls under the remit of Misrad Harishui (the Licensing Bureau), which operates as part of the Ministry of Transport and Road Safety. Every vehicle driven in Israel must carry a valid rishayon rechev (vehicle registration document), which requires annual renewal.

When purchasing a new vehicle from a dealership, the dealer typically manages the initial registration submission to Misrad Harishui and Meches on the buyer’s behalf. The dealership forwards original documents — including the buyer’s passport and driver’s licence — to the border to retrieve the car from Meches, and these documents are returned with the vehicle approximately two weeks later.

For an imported vehicle, registration takes place once the car has successfully cleared the standardisation check. The process for registering an imported vehicle generally involves:

1. Receiving clearance from Meches (the Customs Authority) confirming that all import taxes have been paid or lawfully deferred
2. Passing the standardisation check carried out by Misrad Hatachbura’s Personal Imports Division
3. Lodging the required documents with Misrad Harishui, including your passport, Teudat Zehut or Teudat Oleh (as applicable), proof of insurance, and customs clearance paperwork
4. Paying the applicable registration fee
5. Receiving your rishayon rechev (vehicle registration certificate)

Renewing registration requires both a payment and a vehicle inspection (the annual roadworthiness test). There is no longer any requirement to display a sticker on the windscreen confirming registration status. Ensuring that registration is renewed before it lapses is the owner’s responsibility.

Both Teudat Zehut holders and visa holders can pay renewal fees using an Israeli credit card through the Misrad Hatachbura website. Appointments at Misrad Harishui can be scheduled by dialling *5678 or online at govisit.gov.il.

What insurance do I need to drive legally in Israel?

Israel operates a two-tier vehicle insurance framework. Compulsory third-party liability cover — known as Bituach Chova — is a legal requirement for all vehicles on Israeli roads. This is a separate product from voluntary comprehensive insurance, which protects your own vehicle against damage, theft, and related risks.

The mandatory Bituach Chova insurance in Israel differs in important respects from compulsory motor insurance in many other countries. It functions as a no-fault personal injury scheme, providing compensation for bodily harm to any road accident victim — whether driver, passenger, or pedestrian — irrespective of who bore responsibility for the incident. Administered within a government-regulated structure, it covers personal injury costs only and does not extend to vehicle damage or damage to third-party property. Unlike some insurance systems that combine personal injury and property liability into a single comprehensive policy, Israel treats these as entirely distinct products.

Beyond Bituach Chova, most drivers in Israel also take out third-party property damage cover (Tzad Gimel) and frequently comprehensive (Mekiph) insurance, though only the compulsory layer is legally required. When driving, you are required to carry official Israeli identification (ID card or passport), a certificate of insurance, and any appendices to your driver’s licence.

Some insurers will only cover used vehicles on a total-loss basis, which is worth investigating before committing to a secondhand purchase. Expats should also be aware that a no-claims history accumulated with an overseas insurer may not be automatically recognised by Israeli providers; obtaining a formal letter from your previous insurer confirming your claims record may help you negotiate a more favourable premium.

Insurance products are offered by a range of private insurers regulated by the Capital Market, Insurance and Savings Authority (part of the Ministry of Finance). Comparing quotations from several providers and confirming what evidence of prior claims history each will accept is advisable before making a decision.

What driving licence do I need in Israel as an expat?

Residents of Israel holding a foreign driving licence are permitted to drive on it for up to one year from their date of arrival, after which conversion to an Israeli licence is a legal requirement. This one-year grace period applies to residents; tourists and short-stay visitors may continue to drive on a valid foreign licence together with an International Driving Permit (IDP) throughout their authorised stay.

Since 2017, a streamlined conversion route has been available to new immigrants (olim) who held a valid foreign licence for at least five consecutive years prior to making Aliyah. Under this process, an Israeli licence can be issued without the need to sit theoretical or practical examinations. The applicant must undergo an eye test with a licensed optometrist and obtain a general medical fitness declaration (Tofes Yarok) from a family doctor confirming that no disqualifying health conditions are present.

Required supporting documents include a valid passport, the original foreign licence, Teudat Zehut or Teudat Oleh (immigrant identification), and evidence of the five-year driving history, such as a driving record obtained from the licensing authority in the country of origin.

Those with fewer than five years of driving experience, or who are otherwise ineligible for the simplified route, are generally required to pass a theory examination and complete a series of practical driving lessons before an Israeli licence will be issued. The number of lessons required may be fewer than for a first-time applicant, but this varies by case; confirm your specific requirements with Misrad Harishui.

After residing in Israel for one year, driving is only lawful with a valid Israeli licence. Failure to convert within the stipulated timeframe can also affect eligibility for tax concessions when purchasing a vehicle. All driver licensing matters are handled by Misrad Harishui, accessible through the Ministry of Transport and Road Safety.

How do I sell a car in Israel?

Transferring ownership of a vehicle in Israel requires both the seller and buyer to attend a formal ownership transfer at Misrad Harishui, or to complete the procedure at an authorised post office branch or a large dealership. While both parties are normally required to appear, an Israeli citizen may execute a power of attorney rather than attending in person.

Before proceeding with a sale, the seller should verify that:

• The vehicle’s annual registration (rishayon rechev) is current and has not lapsed
• All outstanding road tax, fines, and registration fees have been cleared
• The vehicle holds a valid roadworthiness test certificate, or the prospective buyer has been made aware of its current status
• Any restrictions on the vehicle’s ownership — such as the four-year limitation applicable to cars purchased with Oleh tax benefits — have been reviewed

Selling a car within four years of purchase under Oleh benefits obliges the seller to repay the tax reduction received at the time of acquisition. This is a significant financial factor that must be taken into account when agreeing a sale price.

The term “passport to passport” describes a transaction in which a new Oleh sells their car to another qualifying Oleh within four years of the original purchase date, enabling the tax benefit to be transferred to the buyer rather than being clawed back. The purchasing Oleh must present a valid Israeli driver’s licence and their Teudat Oleh. A fresh four-year restriction on selling the vehicle will commence from the date it is registered in the new owner’s name.

Once the ownership transfer documentation has been lodged with Misrad Harishui, the seller’s responsibility for the vehicle — including ongoing road tax and any fines arising after the transfer date — should end. However, the registered owner remains legally accountable until the transfer is formally recorded in the registry. It is therefore important to retain a copy of the signed transfer documents and to confirm that the transfer has been processed without delay. There is no capital gains tax specifically applicable to the private sale of a personal vehicle in Israel, but seek advice from a local tax professional if the vehicle is being sold as part of a business or realises a substantial profit.

Are there any ongoing costs or obligations for vehicle ownership in Israel?

Owning a vehicle in Israel involves a series of recurring costs and legal duties that apply to all owners, including expats. Accounting for these in advance is an important element of understanding the true total cost of ownership.

Annual vehicle registration renewal: All vehicles must have a valid rishayon rechev renewed each year. Renewal requires both a fee payment and a vehicle inspection (roadworthiness test). The registration fee varies according to vehicle type and engine size; consult the current fee schedule at the Ministry of Transport and Road Safety.

The annual roadworthiness test (“HaTest”): The vast majority of vehicles in Israel must undergo the annual roadworthiness inspection during the calendar month in which the vehicle was first registered. Exceptions apply to new private passenger cars under three years old and new rental or leased vehicles under two years old, which are exempt from testing (though not from the renewal fee). This annual test functions similarly to the MOT in the United Kingdom or the TÜV inspection in Germany, assessing roadworthiness, lighting, brakes, emissions, and safety equipment.

Vehicles fifteen years old or older must have their braking system inspected at a licensed garage, and written confirmation that the braking system is functioning correctly must be produced at the test. Vintage and collector vehicles must be tested twice a year at a Vehicle Inspection Station as a condition of licence renewal.

Both the compulsory insurance (arvut) and the Meches certification must be renewed on an annual basis. In addition to the registration fee and roadworthiness test, you must therefore ensure your Bituach Chova policy is active and valid at the point of renewal. Without evidence of current insurance cover, registration cannot be renewed.

Fuel costs: Fuel prices in Israel are set by the government and revised on a monthly basis. As prices fluctuate, consult the Ministry of Energy and Water Resources for current pump prices when drawing up your budget.

Ongoing customs restrictions: If you imported your vehicle using Oleh benefits, the four-year personal use restriction remains in effect from the date of import, after which it is lifted automatically. This restriction must be removed before ownership can be transferred or the vehicle made available for others to drive.

Frequently asked questions

Can any foreign national buy a new car in Israel, or are there restrictions?

Foreign nationals are able to purchase a new car in Israel, but the applicable process and tax treatment differ considerably depending on immigration status. Permanent residents are liable for the full purchase tax, which can approach 100% of the vehicle’s value as of 2025. New immigrants (olim) and certain visa holders — such as those on an A/2 student visa — are eligible for reduced tax rates or deferral arrangements. Some dealerships may be unwilling to handle sales to non-residents because of the additional administrative burden involved. Confirm your eligibility and status with both the dealership and the Israel Tax Authority before proceeding.

Are right-hand drive vehicles allowed in Israel?

No. Israel is a left-hand traffic country and only left-hand drive vehicles are authorised for use on its roads. Anyone relocating from a right-hand drive market (such as the UK, Japan, or Australia) will not be able to bring their existing vehicle with them; a left-hand drive replacement must instead be purchased or imported.

How long does the vehicle import process take in Israel?

Timelines vary depending on the shipping route and whether documentation is complete when submitted. After paperwork has been lodged with Meches, the vehicle is typically released within ten days to three weeks. The invitation for the standardisation check is usually issued within two weeks of the vehicle’s arrival, although the check itself may take up to two months to conclude. On balance, prospective importers should allow several months from the point of shipment before the vehicle is registered and road-legal. Verify current timelines with your customs agent and Misrad Hatachbura.

What is Meches and what role does it play?

Meches is the everyday name for Israel’s Customs Authority, which operates under the Israel Tax Authority. It is responsible for calculating and collecting import duties and taxes on all vehicles entering Israel, and for verifying eligibility for any concessionary tax treatment. All new cars sold in Israel must also be released through Meches before delivery to the buyer. You can contact Meches directly at [email protected].

How long can I drive in Israel on my foreign licence before I must convert?

As a resident, you may drive on a valid foreign licence for up to one year from your date of entry into Israel. Beyond that point, a valid Israeli driving licence is required. Tourists and short-term visitors may use their foreign licence — alongside an International Driving Permit where necessary — throughout their authorised period of stay. Conversion requirements vary depending on your driving history: individuals with five or more years of full licence experience may qualify for a simplified process that does not require tests. Contact Misrad Harishui through the Ministry of Transport and Road Safety for current requirements.

What is the annual roadworthiness test (“HaTest”) and when must I take it?

The annual roadworthiness test, widely referred to as “HaTest,” is a compulsory inspection that most vehicles must undergo in the calendar month they were originally registered. The inspection covers mechanical condition, safety equipment, brakes, exhaust emissions, and lighting. New private passenger cars under three years old are exempt. Vehicles of fifteen years or more are subject to additional requirements, including a separate brake system check at a licensed workshop. Successfully completing the test is a prerequisite for renewing annual vehicle registration. Tests are conducted at authorised Vehicle Inspection Stations across Israel.

What happens to the Oleh tax benefit if I sell my car within four years?

If a vehicle purchased or imported under Oleh reduced-tax benefits is sold within four years of the original transaction date, the seller is required to reimburse the tax saving that was received at the time of purchase. Once five years have passed from the date of purchase, no repayment obligation arises. An exception applies to “passport to passport” sales — where one qualifying Oleh sells to another — which allows the benefit to pass to the new owner rather than being reclaimed. Confirm the current rules with the Israel Tax Authority.

Is no-claims history from a foreign insurer recognised in Israel?

Israeli insurers have no formal obligation to recognise a no-claims discount earned with an overseas provider, unlike certain countries — particularly EU member states — where no-claims certificates are routinely accepted across borders. Nevertheless, obtaining a formal no-claims letter from your previous insurer and presenting it when requesting quotations may prove beneficial; some Israeli insurers will consider such documentation when calculating your premium, though the degree to which it is taken into account varies between providers. Obtain quotes from multiple insurers regulated by the Capital Market, Insurance and Savings Authority.