Report: Israel Close to the Top in Gas Taxes

An Israeli gas station. Photo by Danielle Shitrit/FLASH90
An Israeli gas station. (Danielle Shitrit/Flash90)

As gas prices went up Tuesday, a new report from the Israel Energy and Environmental Institute said that one of the reasons gas prices were so high in Israel was due to the high level of taxation on fuel. Current prices for 95 octane fuel stand at NIS 6.03 per liter – $5.92 per gallon, at current exchange rates. Out of the retail price of gas, NIS 3.90 went to taxes.

That is one of the highest levels of taxation anywhere. In fact, the only countries that tax fuel more harshly are Holland, Italy, Finland, and Greece. As if that weren’t enough, taxes were on a constant increase; four years ago, total taxes on gas were 45 percent of the cost of a liter, while today they are 65 percent. The state earns an annual NIS 14 billion from this most ubiquitous of “sin taxes.”

Gasoline prices rose Tuesday, November 1, as the government reset the maximum price for fuel based on current market prices. A liter of 95 octane fuel at self service pumps went up 14 agurot, and now costs NIS 6.03. The increase is due to a combination of a slight recovery in recent weeks of the price of oil, but mainly to a rise in the value of the dollar versus the shekel, which on Tuesday was NIS 3.89/shekel.