Israel is poised to launch one of its most ambitious immigration incentives in years, as Finance Minister Bezalel Smotrich rolled out a new tax reform aimed at easing the financial burden for olim chadashim (new immigrants). The plan, part of the upcoming state budget, is expected to receive swift approval and deliver major tax benefits to Jews moving to Israel.
At its core, the reform seeks to make aliyah more attractive by offering generous tax relief while fostering smoother integration into the workforce and business landscape. The initiative arrives at a time of intensifying global antisemitism and shifting tax climates abroad, such as in the United Kingdom. Israel’s economic planners view this as a golden opportunity to draw skilled professionals, entrepreneurs, and investors who can strengthen the nation’s economy and deepen its Jewish character.
The reform was presented at a joint event organized with Nefesh B’Nefesh and attended by top officials across the finance and aliyah sectors. Among them were Minister Smotrich, Aliyah and Integration Minister Ofir Sofer, Tax Authority Director Shay Aharonovich, Finance Ministry Director-General Ilan Rom, Aliyah and Integration Ministry Director-General Avichai Kahana, Jewish Agency aliyah head Eran Berkowitz, and Nefesh B’Nefesh CEO Rabbi Yehoshua Fass. Speakers at the gathering described the new policy as a powerful expression of Zionism in action — one that would not only bolster Israel’s economy but also renew the national mission of bringing Jews home.
Under the proposed tax framework, benefits will start at up to 0% in 2026 and 2027, rise to 10% in 2028, 20% in 2029, and reach 30% by 2030. The exemptions will apply to income of up to ₪1 million annually.
In addition to the new tax brackets, olim will continue to enjoy existing incentives — including a 10-year exemption on foreign income and the established tax credit points already available to new immigrants and returning residents.
Smotrich, who has repeatedly framed economic reform as part of a broader Zionist vision, praised the initiative in bold terms. “Zionism has always been built on three pillars: settlement, security, and aliyah. Over the past two years, we have invested heavily in security, and thank God, Israel is in a different place today. In settlement, we are leading a revolution – in Judea and Samaria, the South, the North, the Negev, the Galilee, and the Golan.”
He continued, “The year 2026 will bring a revolution in aliyah – not as a slogan, but as a practical plan of action.” Calling on Jews abroad to take advantage of the opportunity, he added, “I call upon Jews in the Diaspora and Israelis abroad: come home. My thanks to Minister Ofir Sofer for his partnership, to Tax Authority Director Shay Aharonovich for leading the professional work, and to Nefesh B’Nefesh for its years of dedication to encouraging Aliyah and strengthening Israel’s Jewish identity.”
Aliyah and Integration Minister Ofir Sofer echoed that sentiment, emphasizing the long-term national impact of the move. “Over the past three years, we have strengthened and rebuilt Israel’s aliyah and integration infrastructure. Today we are adding a major and meaningful component to our national effort to encourage aliya.”
He went on to thank his colleagues, adding, “I am grateful to Minister Smotrich and all our partners for their productive collaboration. This is a data-driven and comprehensive initiative, designed to ensure optimal absorption for new olim, create real opportunities for their integration into Israeli society, and contribute to economic growth.”
Sofer concluded by underscoring the broader purpose of the reform: “Aliyah holds profound Zionist, social, and economic significance for the State of Israel. It strengthens our social fabric, brings high-quality human capital, and boosts growth, innovation, and national development.”
With this landmark reform, Israel is not merely adjusting its tax code — it is signaling a new chapter in the country’s historic commitment to building a homeland for every Jew who wishes to call it home.
{Matzav.com}