Importing goods into Israel?
One of the most important things to understand is how import taxes are calculated.
The basis for calculation is the customs value-an amount that includes the cost of the product, shipping expenses, and cargo insurance.
In this post, we’ll explain how the customs value is calculated depending on the type of shipment-air or sea.
Air Shipments: How Is the Customs Value Calculated?
For air shipments, the customs value is based on the CIP model (Carriage and Insurance Paid to).
This means the calculation includes all expenses up to the point of arrival in Israel.
The value includes:
- The purchase price of the product
- Domestic transportation in the country of origin
- Air freight to Israel
- Shipping insurance
⚠️ Note: Port fees are not included in air shipments!
Once all costs are totaled, the government imposes customs duty, VAT, and other applicable taxes according to the product classification.
Sea Shipments: How Is the Customs Value Calculated?
For sea shipments, the customs value is calculated according to the CIF model (Cost, Insurance, and Freight).
Unlike air shipments, port fees in Israel are included in the calculation.
The value includes:
- Product price
- Domestic transportation in the country of origin
- Sea freight to Israel
- Shipping insurance
- Port fees
⚠️ Only in sea shipments are port fees added to the customs value!
Here too, once all components are summed, taxes are applied based on the product classification.
Why Is This Important?
✅ Accurate Budget Planning
Calculating the customs value in advance allows for better financial preparation and prevents surprises.
✅ Faster Customs Clearance
Correct and precise declaration of the value avoids unnecessary delays.
✅ Smart Shipping Method Selection
Choosing between air and sea freight can directly affect the amount of taxes you pay.
In Summary
The customs value determines how much tax you will actually pay.
- For air shipments, it’s calculated according to CIP.
- For sea shipments, it’s calculated according to CIF, including port fees.
Understanding this in advance helps you plan better, optimize costs, and prevent import delays.
