Tax Authority crypto voluntary disclosure disappoints

Last August the Israel Tax Authority published its latest voluntary disclosure procedure, which grants immunity from criminal proceedings for those who reveal their hidden capital. The state had expected revenues of NIS 2-3 billion from the procedure, mainly from taxing crypto profits but data obtained by “Globes” reveals that the amount garnered has fallen far short. Since the publication of the procedure, 289 disclosure requests have been submitted to the Tax Authority, with the reported capital amounting to NIS 676.5 million, and the tax due on the amount estimated at NIS 40.9 million.

The number of requests has more than doubled since January 2026 (then 122 disclosure requests were submitted, with the reported capital amounting to NIS 262 million), but it is clear that this is not what the Tax Authority expected. The problem, all experts say, and they warned about this in advance, is that, unlike in the past, the procedure does not include an anonymous disclosure track that allows anonymous applications in order to examine the tax implications of the disclosure.

“These are not the results the Tax Authority was looking for,” says Adv. Iftach Simhony CPA, partner and head of the tax department at the firm Prof. Bein law office. “The cancellation of the anonymous track not only deterred taxpayers, it changed the balance of power in the process. Everything is exposed to the Tax Authority, and there is no real ability to negotiate. In such a situation, the uncertainty about the tax outcome becomes a real risk. The taxpayer is required to enter the process before knowing what the actual exposure will be, and therefore many prefer to stay out.”

The incentive to make voluntary disclosure has weakened

The voluntary disclosure procedure allows citizens to reveal the funds and assets they concealed “beneath virtual, physical and global barriers” and did not pay tax on, while receiving criminal immunity. The track published in August last year and scheduled to end on August 31 2026 does not include an anonymous disclosure track as in the past but does include a fast “green” track for reporting small amounts, including cryptocurrency profits, without the need for discussions with an assessment officer.

Even before publication of the procedure, the Tax Authority was engaged in major efforts to uncover taxes on cryptocurrency profits, among other things, after criticism from the State Comptroller, who found that there was an unrealized collection potential of NIS 3 billion in the crypto market. However, it seems that the procedure is set to fail, with only 58 requests, for which the reported capital is estimated at NIS 145.8 million – a far cry from the “black” billions circulating.

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According to Adv. Simhony, “In the cryptocurrency field, the difficulty of the absence of an anonymous track is even more acute. 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.”

This is the third voluntary disclosure procedure after procedures were previously implemented in 2011-2012, 2014-2016, and 2017-2019 (the last two procedures were published in one framework). As part of these procedures, abouty9,000 cases were handled and a total of some NIS 5 billion in tax was collected.

No response has been forthcoming from the Israel Tax Authority.

Published by Globes, Israel business news – en.globes.co.il – on June 3, 2026.

© Copyright of Globes Publisher Itonut (1983) Ltd., 2026.