The Tax Authority on Sunday opened a new track for submitting compensation claims for direct damage caused to business property or a business owner’s private residence as a result of protection racket extortion. Operated as a pilot program pursuant to Government Decision 4299, the track applies to damage incurred between October 4, 2026, and December 4, 2026.
The compensation is intended for owners of lawful businesses who hold a valid business license and an active file with the Tax Authority, and whose property – such as a building, inventory, or equipment belonging to the business – or private residence suffered direct damage following a refusal to pay protection fees or after filing a police complaint.
Eligibility for compensation is subject to several conditions. Among other requirements, a police complaint must have been filed and recognized as relating to protection racket extortion. In addition, the business owner must demonstrate an inability to secure property damage insurance coverage despite having been previously insured under such coverage, or that their claim for the damage was rejected by the insurance company. Further requirements include compliance with physical security measures and risk-mitigation demands specified by the insurance company, as well as providing authorization that the structure was lawfully built in cases involving building damage.
Claims must be submitted to the Tax Authority’s Compensation Fund within seven days of the damage occurring. Submissions are made online through a dedicated portal, accompanied by all required documentation. The Tax Authority emphasized that damage must not be repaired prior to filing the claim and before an assessment by a Property Tax appraiser, as carrying out repairs could impair the ability to evaluate the damage and result in the rejection of the claim. However, clearing away broken glass and debris is permitted.
The compensation cap under this track is NIS 2 million. Compensation will be provided for direct damage only, excluding indirect damage or third-party damage. The processing time for claims is set at up to eight months, subject to standard procedures.