Breaking Update
New Law Expected to Expand Competition in Automotive Imports, Reduce Prices for Consumers
Israel approves new law to expand automotive import competition, allowing indirect importers customs duty exemption to reduce consumer prices.
Jerusalem, 23 December, 2025 (TPS-IL) — The government approved Monday what it called another step to reduce the cost of living in Israel – the amendment to the Law on Licensing Services and Professions in the Automotive Industry.
The amendment, which was formulated by the Ministry of Transportation, in cooperation with the Taxation Division and approved by the Ministerial Committee for Legislative Affairs, is being promoted through an accelerated process and is intended to increase competition in vehicle imports, open it to additional players, and lead to lower vehicle prices.
It removes a major competitive barrier that has so far prevented indirect, small, and personal importers from enjoying customs preferences in accordance with the State of Israel’s international trade agreements.
Until now, only direct importers could exercise a 7% customs duty exemption, a situation that reduced competition and raised prices for the public.
The new law will allow the Tax Authority to apply the benefit also to importers who are not direct, thus helping to expand parallel and personal imports, increase competition, and reduce consumer prices.
