Israel’s Tax Authority Unmoved by Crypto Voluntary Disclosures: What’s Behind Their Disappointment?
Ever wondered why Israeli taxpayers aren’t racing to confess their crypto gains despite a get-out-of-jail-free card from the Israel Tax Authority? It turns out, even with a policy granting immunity to those who come clean, the expected flood of voluntary crypto disclosures has trickled in—barely scratching the surface of an estimated $1 billion haul. This puzzling shortfall raises a juicy question: when dealing with something as elusive as cryptocurrency, does the lack of guaranteed anonymity and shaky risk assessments really kill the motivation to come clean? As only a handful have stepped up to fix their past reports, and billions in digital assets potentially lurk under the radar, this standoff shines a light on the tangled dance between crypto holders and tax authorities worldwide. Curious how all this plays out amid legislative moves in the US and beyond? Dive deeper into the twists and turns of crypto tax compliance right here. LEARN MORE.
Israeli taxpayer disclosures of profits from cryptocurrencies have reportedly fallen short of expectations at the Israel Tax Authority after enactment of a policy allowing immunity from criminal proceedings for filers correcting their reports.
According to a Wednesday report from Globes, Israeli authorities had expected to gain up to $1 billion in taxes from “voluntary disclosures” allowed under an August 2025 policy, but have so far only received reports of a fraction of those capital earnings.
The local news outlet reported that the tax authority had received reports of $50 million combined from crypto capital, with the potential of billions of dollars in underreported holdings.
“In the cryptocurrency field, the difficulty of the absence of an anonymous track is even more acute,” said Iftach Simhony, a CPA and head of the tax department at the Prof. Bein Law Office, Globes reported. “When the risk assessment of some taxpayers is not high, and the procedure itself does not offer certainty or anonymity in the first stage, the incentive to undergo voluntary disclosure is weakened.”
The voluntary disclosure procedure announced by the tax authority gives crypto holders immunity from criminal charges, provided the value of their holdings did not exceed the equivalent of $522,000 as of December 2024, they filed correct reports and paid their taxes in full before Aug. 31, 2026. Globes reported only 58 filers had attempted to correct their taxes using the procedure.
Related: Israel crypto industry pushes regulatory changes amid strong public support
According to the Bank of Israel’s financial stability report for January to June 2024, Israelis held about $1 billion worth of crypto assets.
US lawmakers seek to create de minimis exemption for crypto taxes
A group of members of the US Congress introduced legislation in May called the PARITY Act that would direct the US Internal Revenue Service (IRS), to review creating a de minimis exemption for digital assets. Under the proposed law, taxpayers could not be forced to reported small crypto transactions to the IRS.
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