Israel limits the use of cash and encourages digital payments.

Any transaction involving a firm that costs more than NIS 6,000 or a private transaction between two people that costs more than...

Written by thew3guy · 1 min read >
Israel limits the use of cash and encourages digital payments.

Any transaction involving a firm that costs more than NIS 6,000 or a private transaction between two people that costs more than NIS 15,000 is forbidden.

Israel limits the use of cash and encourages digital payments.

As of August 1, depending on the entity with which they are interacting, Israeli nationals are no longer permitted to utilize cash for transactions greater than 6,000 shekels (about $1,760) and 15,000 shekels (around $4,400). The use of digital payments will be promoted as an alternative.

In order to avoid using “black money” and to combat tax evasion, money laundering, and terrorist financing, the Israel Tax Authority issued laws in March 2018. In Israel, it was acknowledged that cash served as the shadow economy’s fuel.

What does the law actually say?

Cash is prohibited in any transaction worth more than NIS 6,000 within a business and more than NIS 15,000 between private individuals, according to Israel’s leading law firm Herzog Law.

These figures represent a decrease from the previous transaction limits. Personal transactions were limited to 50,000 shekels ($14,660) and business transactions to 11,000 shekels ($3,220).

“We want the public to use less cash,” Tamar Bracha, the Israel Tax Authority official in charge of enforcing the rules, said. The goal is to reduce market cash liquidity, primarily because criminal organizations rely on cash. The criminal activity becomes much more difficult to carry out by limiting its use.”

What are the ‘Cash Law’ exceptions?

The new law makes some exceptions, such as charitable organizations and trade with Palestinians from the West Bank who are not Israeli citizens.

Deals involving large sums of money will be permitted in such cases, but a detailed report to the Israel Money Laundering and Terror Financing Prohibition Authority will be required.

“For political reasons, the exemption for Palestinians applies until the end of 2022,” Adv. Uri Goldman, an expert in international taxation, economic crime, and money laundering prohibition, explains.

Written by thew3guy
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