The Israel Tax Authority carried out a nationwide enforcement operation this week involving hundreds of employees from across its departments. The campaign, dubbed “Financial Brake,” targeted roughly 2,462 businesses that owe VAT payments. More than 200 million shekels were collected, and 146 vehicles were seized.
860,000 Shekels Collected via Third-Party Seizures
The operation aimed to strengthen enforcement, serve as a deterrent, and promote greater equality in the tax burden.
In addition to direct collections and asset seizures, approximately 860,000 shekels were recovered through third-party seizures. The Tax Authority expects this amount to increase as more owners of seized vehicles step forward to settle their debts. The operation was carried out in coordination with the National Collection Enforcement Unit, investigators, bookkeeping enforcement teams, and the Israel Police.
Inspections Using AI and Big Data
A key focus of the enforcement effort was the auto repair and parts sector. Targeted inspections were conducted at 107 businesses using advanced tools such as artificial intelligence and big data analysis. These inspections are expected to result in new tax assessments, some of which may include disqualification of business records and criminal indictments. In parallel, the National Bookkeeping Unit conducted an additional 65 audits across the country—revealing unreported income and numerous other violations in 40% of the garages inspected.
Examples from the Field:
- At a garage in Majdal Shams, vehicles that had been documented in advance were not recorded in the accounting system.
- In Kafr Qassem, luxury vehicles were found on lifts without documentation. The business owner explained, “I haven’t given a price quote yet.”
- At a garage in Shilat, income totaling 190,000 shekels was not recorded. The owner said, “Some of it we missed, some were security checks.”
- Additional garages in Netivot, Ramla, and Kiryat Ekron were found to have significant unreported income—ranging from tens to hundreds of thousands of shekels—including payments received via mobile apps.
“We Will Strengthen Equality in the Tax Burden”
The Tax Authority stated: “We will continue enforcement actions against tax debtors across the country, including investigations, business inspections, and more—in order to combat the shadow economy, improve compliance among business owners, ensure accurate tax collection, and thereby promote fairness in the tax burden and strengthen deterrence among citizens.”
