Intention: grants paid to athletes by the Israel Olympic Committee for winning a medal at the Olympic or Paralympic Games will be tax-free

The Minister of Finance, Avigdor Lieberman, issued a memorandum amending the Income Tax Ordinance, according to which the grants paid to athletes by the Israel Olympic Committee for winning a medal at the Olympic or Paralympic Games will be tax-free, in order to support athletes representing the State of Israel.
This means that all Israeli athletes who have already won medals in Tokyo and who will still win medals at the Paralympic Games that are taking place these days - will not have to pay any tax on the winnings. The tax authority said that the winners of the medals would be tax-exempt immediately.
In the past month, there have been a number of calls from MKs and various bodies for an exemption, and now the Tax Authority and the Ministry of Finance have agreed on the move, and they will advance legislation in the coming weeks - so that it will apply retroactively to all Tokyo winners. It should be noted that the coaches of the athletes, who are also entitled to grants - will not benefit from the exemption.
This is good news for the outstanding Israeli swimmer Mark Billion, who today won a second gold medal at the Paralympic Games. Without the exemption, Maliar was supposed to pay a tax of about one hundred thousand shekels on the grants, since there is a tax exemption for 100% disabled people, but so far a ceiling of the exemption on the income of 100% disabled has been set for 2021 at 614,400 shekels. Since the second medal brought the total of Miliar's winnings to NIS 750,000 (a second medal earns half of the grant), he had to pay the tax for an amount of about NIS 136,000.
In total, the Israeli delegation to the Paralympic Games is expected to bring home between 6 and 12 medals, with the winners of course receiving various grants according to the size of the achievement. So far, apart from Miliar, swimmer Iyad Shelby has won a gold medal, swimmer Ami Dadon a silver medal, and rower Moran Samuel a silver medal as well.
The sweeping tax exemption will also apply to Israeli athletes who won medals at the Olympic Games in Tokyo, since the Minister of Finance and the Tax Authority intend to declare an exemption starting from the entire tax year 2021. This is Linoy Ashram and Artium Dolgofiat who won gold medals A quarter of a million shekels, and members of the judo team who won a team bronze medal and each received 50,000 shekels.
Today, every Israeli athlete is required to pay tax on the cash winnings for the medal in which he won the marginal tax rate that he must pay per year. Ashram and Dolgofiat, were therefore forced to pay NIS 150,000 in income tax for winning half a million shekels. Samberg was required by existing law to pay NIS 42,000 for the win, unless she recorded additional income, and members of the judo team were only supposed to pay a few thousand shekels for the win, only if they worked some other job, or were completely exempt from payment. Income tax on winning NIS 50,000.
The Tax Authority stated that according to the existing law in the case of winning a medal the tax is collected as a "marginal tax on income from occupation", as opposed to a tax on prizes and lotteries (Pace, Toto) which is collected at a fixed rate of 30% on large prizes and lotteries. In the case of winning medals, the tax is currently ranked according to the tax brackets in accordance with income tax laws.
The Minister of Finance, Avigdor Lieberman, said: "This summer is full of national pride in Israeli sports. However, it is not enough just to get excited and applaud, but to reach those athletes that we will recognize and appreciate in deeds.
The hard work, the many hours on the mattress or in the water, the many injuries and moments of crisis, these are moments that the public does not see on screen. This step is not just for them, it is for all of us. "