How is it calculated?
Purchase tax is calculated in marginal brackets — each rate applies only to the slice of the price inside its bracket, not to the whole amount. For a single home in 2026: 0% up to ₪1,978,745, then 3.5% on the slice up to ₪2,347,040, 5% up to ₪6,055,070, 8% up to ₪20,183,565, and 10% above. An additional or investment home gets no exemption: 8% from the first shekel up to ₪6,055,070 and 10% above. The single-home brackets were frozen on 16.1.2024 for five years, so they are identical in 2026.
Worked example: a single home at ₪2,500,000 — the first ₪1,978,745 is tax-free, the next ₪368,295 is taxed at 3.5% (about ₪12,900), and the remaining ₪152,960 at 5% (about ₪7,650). Total: roughly ₪20,500 — an effective rate of only about 0.8%. For comparison, an investment home at ₪2,000,000 pays 8% from the first shekel — ₪160,000.