Israeli Municipalities Seek Property Tax Hikes Above 3.05% for 2027
Israel municipal property taxes are set to rise 3.05% in 2027, while several cities including Rehovot, Eilat, and Haifa seek additional hikes pending government approval.
Property tax rates across Israel are set to increase by 3.05% starting January 1, 2027, following the annual update mandated by the Ministry of Interior. However, several local municipalities have submitted requests for steeper hikes and asset classification changes, pending final approval from the Ministries of Interior and Finance.
According to official data released by the Ministry of Interior, the 2027 adjustment rate is calculated based on a formula weighing changes in the Consumer Price Index and average public sector wages. The CPI rose by 1.94%, while average public sector wages increased by 4.16%, resulting in the nationwide 3.05% adjustment. For illustration, a household currently paying an annual property tax of 6,000 shekels will see an automatic increase of 183 shekels per year before any additional municipal hikes.
Municipalities Seek Exception Hikes
Among the notable requests, the Rehovot municipality announced its intention to raise property taxes on certain residential properties by a total of 8%, which includes the nationwide 3.05% adjustment. The city explained that the measure aims to gradually bridge historical disparities between taxation zones, noting that roughly 66% of residents currently pay higher rates than others in similar areas. The change remains subject to ministerial approval.
In Ness Ziona, authorities requested an extraordinary addition of 2.5% for residential properties and 4.5% for other assets, on top of the 3.05% national update. Meanwhile, the Eilat city council approved a 2027 tax order in June 2026, requesting a 4.0% extraordinary hike on commercial vacation apartments and restructuring tax brackets for hotels, capped at a 10% increase for 2027 with the remainder deferred to 2028.
Approval Process and Final Impact
The Haifa municipality has also published documents regarding a request for an extraordinary property tax permit for 2027, awaiting official review.
The Ministry of Interior emphasized that all extraordinary requests for 2027 have not yet been examined or validated. Any municipal tax rate changes exceeding the national adjustment require strict exceptional approval from the Ministries of Interior and Finance. Final billing will depend on municipal orders, property classifications, and official approvals.
