Israel Corporate Income Tax
Detailed corporate income tax rates and rules for Israel in 2026.
Israel's standard corporate tax rate is 23%. Companies qualifying under the Law for Encouragement of Capital Investments can benefit from significantly reduced rates: 'Preferred Enterprise' status provides a 16% rate (7.5% in designated development areas); 'Preferred Technological Enterprise' status offers 12% (7.5% in development areas) on income derived from qualifying intellectual property. 'Special Preferred Technological Enterprise' status (for companies with consolidated revenue exceeding ILS 10 billion) offers a 6% rate.
Standard Rate
23%
Additional Notes
Israel's tax incentive regime strongly supports the technology sector. R&D costs are generally deductible in the year incurred. The Innovation Authority provides grants and programs for startups. Israel has extensive tax ruling practice allowing companies to obtain advance certainty on tax positions. Controlled foreign corporation (CFC) rules apply to Israeli shareholders of low-tax foreign entities. Transfer pricing rules require arm's length pricing with documentation requirements.
How Israel Corporate Tax compares
Israel’s corporate tax rate of 23% is the 111th highest of 203 countries TaxAtlas tracks, above the global average of 22.2% and Asia’s regional average of 19.7%.
