Israel is rolling out a major financial incentive aimed at encouraging Jews worldwide to make aliyah, offering a new income-tax exemption for immigrants arriving in 2026, Israeli officials confirmed to JNS this week.
Aliyah and Integration Minister Ofir Sofer and Finance Minister Bezalel Smotrich recently announced the government’s intention to grant a five-year income-tax exemption to new olim (immigrants) and returning residents who relocate to Israel during the 2026 calendar year.
According to guidelines published by the Ministry of Aliyah and Integration, the reform would apply to earned income in Israel, including salaries and self-employed business income, from 2026 through 2030. The exemption would be capped at one million shekels (approx. $335,000 in 2026 and 2027, 600,000 shekels (approx. $200,000) in 2028, 350,000 (approx. $117,000) in 2029 and 150,000 (approx. $50,000) in 2030.
For those employed by a relative, the exemption would be limited to 140,000 shekels (approx. $47,000) annually. The measure is expected to take several months to pass into law, with benefits applied retroactively once enacted.
Eligibility extends to new olim and returning residents who have lived abroad for more than 10 years and who immigrate between Nov. 5, 2025, and the end of 2026. The reform would not affect existing benefits, including the 10-year exemption on foreign-source income and tax-credit points. Passive income, such as dividends, interest and rental income, would not qualify under the new plan.
The proposal also includes safeguards intended to prevent abuse, stipulating that individuals who spend fewer than 75 days in Israel in 2028 or 2029 would forfeit eligibility.
Officials say the initiative is designed to ease the financial burden of relocation and accelerate integration into Israel’s workforce.
Matan Ben Harush, Sofer’s spokesperson, said, “This is a groundbreaking and important proposal that demonstrates how committed the State of Israel and Minister Ofir Sofer, together with Minister Bezalel Smotrich, are to encouraging Jewish immigration to Israel.”
He added, “We are working to promote the program and hope it will be as effective as possible in encouraging aliyah, alongside a range of additional measures, such as reforms in licensed professions, tax benefits on home purchases, Hebrew-language studies, student programs and more.”
Yael Katsman, vice president of communications for Nefesh B’Nefesh, the organization dedicated to facilitating North American aliyah, said, “By easing the financial burden of the critical first years of aliyah, this new law has the potential to turn the dream of aliyah into a realistic and achievable step for many more people. For years, financial concerns have been a significant barrier. This law helps change that equation, giving prospective olim greater ability to build both a meaningful life and a sustainable future in Israel.”
Yehuda Amrani, spokesperson for the Finance Ministry, said, “We believe this will have an impact, but it is very difficult to provide specific figures at this stage.”
The Ministry of Aliyah and Integration framed the reform as an immediate opportunity for prospective immigrants, stating in its official statement: “On the contrary, the purpose of announcing this reform is to help you make the decision and choose now, more than ever, to make aliyah. Everyone who makes aliyah from now until the end of 2026 will benefit from this significant tax advantage. Come, we’re waiting for you in Israel!”
