As part of the effort to increase the collection of the tax on electronic cigarettes, yesterday the Tax Authority conducted an extensive audit operation, as part of which shops selling electronic cigarettes throughout the country were inspected. In addition, importers and manufacturers in the field were examined.

Liquid for filling electronic cigarettes and disposable electronic cigarettes is subject to a purchase tax in Israel of 145% + 5.66 Shekels ($1.6) per ml, but not less than 10.04 ($2.75) per ml. The activity of the audit raises the suspicion of the sale of electronic cigarettes while evading the payment of purchase tax estimated at tens of millions of Shekels, among other things through the importation of tax-exempt materials used to assemble the filling liquid and mix them in Israel.

The Tax Authority said that during the activity, various findings were discovered that support these suspicions, such as packages containing smoking liquid without labels and separate rolls of labels were attached to them, labels written in English and not written in Hebrew, and bottles on which were listed all the components that make up the liquid used for smoking. In addition, finished products and many documents were seized which support and confirm the suspicions. All the findings were forwarded to the purchase tax unit for further processing.

“This activity constitutes the first stage of enforcement in this area, and later an inspection will be conducted with other dealers in the area, for the purpose of establishing deterrence in the industry and ensuring the payment of purchase tax and VAT applicable to these products,” said the Authority.

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