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Do israeli people need to pay VAT for hotel booking in Eilat

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David  Gluck
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A foreign tourist not holding an Israeli passport/citizenship and does not live here for more than 180 days a year, does not pay VAT on car rentals and hotels. In order to receive this deduction you must provide the provider with your foreign passport, your home address and phone number and many times a written statement that you are a foreign national. You do pay VAT on anything that is not sustainable such as food, visiting a museum/park or special activities. There are stores which offer VAT refund forms for you to receive money back before departing from the country, at the airport (just inside the departure terminal). These stores have a sticker in their window and your purchase must be higher than $100 in any particular store.

In short tourists pay all taxes on products and goods and are entitled to a refund for VAT only as stated above.

Under the terms of the Eilat Free Trade Area Law that went into effect Nov. 1, 1985, goods sold in Eilat for local consumption are exempt from the VAT that prevails in the rest of the country
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Getzy Klein
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As long as you hold an Israeli passport you are not a tourist - therefore you will be charged VAT on hotels and car rentals and are not eligible for VAT refunds at the airport.
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