Israel Tax Authority's voluntary crypto disclosure program has fallen far short of expectations. According to Israeli financial daily Globes, only 58 taxpayers participated by the August 31, 2026 deadline, reporting a total of roughly $50 million in crypto capital gains. The authority had initially projected the program could generate up to $1 billion in tax revenue — a gap of nearly 20-fold.
58 Filers vs $1 Billion: The Reality Check
Launched in August 2025, the program allowed crypto holders to settle back taxes without facing criminal prosecution. Eligibility required that the value of crypto assets held as of December 2024 did not exceed $522,000, that a correct return was filed, and that full payment was made by the deadline. The authority expected thousands to participate, yet only 58 individuals stepped forward. Even with the $522,000 cap covering most retail investors, the vast majority of potential filers chose to stay in the shadows.
Anonymity Gaps Are the Core Bottleneck
Iftach Simhony, CPA and head of the tax department at Prof. Bein Law Office, told Globes: “In the crypto space, the absence of anonymous reporting channels creates a higher barrier. When a taxpayer’s risk profile is low and the program offers no certainty or anonymity at the first stage, the incentive to disclose naturally weakens.” This highlights a fundamental tension in global crypto tax enforcement: while blockchain transactions are publicly visible, early investors without proper cost-basis records must expose their full crypto holdings to the tax authority. Without a clear promise of immunity, the psychological barrier to voluntary compliance remains formidable.
Israel's Crypto Holdings: ~$1 Billion
The Bank of Israel's Financial Stability Report for the first half of 2024 estimated that Israeli residents held approximately $1 billion in crypto assets. That means the amount declared under the program represents only about 5% of estimated resident holdings. The tax authority's original $1 billion revenue projection was based on a far more optimistic assumption — that most holders would come forward voluntarily.
Global Crypto Tax Policy Contrasts
Israel's experience is not unique. In the U.S., the PARITY Act introduced in May 2025 calls on the IRS to study a de minimis exemption for small digital asset transactions. If enacted, taxpayers would not need to report minor crypto trades — a similar attempt to balance compliance encouragement with minimal intrusion. South Korea also saw policy reversals: the Ministry of Economy and Finance and the National Tax Service disagreed over withholding tax on Bithumb, eventually shelving the plan. Across Asia, three challenges persist: defining taxable events, tracking on-chain activity, and lowering compliance costs.
The Israeli case offers a cautionary tale for regulators worldwide: a soft approach of “amnesty plus deadline” without proper anonymity safeguards or simplified procedures is unlikely to bring crypto assets into the tax net. The tension between on-chain transparency and personal privacy remains one of the toughest structural hurdles in crypto taxation.