Dear friends and colleagues,

As a follow-up to our client update from February 16, 2021, we would like to update you that a new Customs procedure regarding importing goods under customs items 810 and 212, is expected to come into effect on June 1, 2022.

Item 810 grants a tax exemption on the import of returned exports, and item 212 grants a tax exemption on the temporary entry of imports.

Classification of goods under item 810 will exempt them from customs, purchase tax, and VAT. The classification will be possible if the following conditions are met: (1) The imported goods or their parts have been exported from Israel; (2) the customs duties for the exported goods were paid or were not paid because they were not liable; (3) The goods are returned to the State of Israel within a 5-year period from the time of export (or a longer period if the approval of the Customs Authority is obtained).

Under the new procedure, when companies submit the import declaration in which the goods are classified in item 810 they are required to enter the number of the export declaration. This procedure reverses previous lenience granted to some of the companies regarding this matter (as part of the “high-tech arrangement”). However, the new procedure includes mitigating provisions for importers, who temporarily import goods that were manufactured in Israel for the purposes of inspection, repair, renovation, or renewal. Under the new procedure, it will be possible to classify returned goods under item 810, without specifying the number of the export declaration under which the goods were exported for the first time. Instead, importers will have to indicate, when exporting the goods for the second time, the import declaration in which the goods were returned to Israel. This procedure also grants an exemption from import legality.

To be eligible for the benefits of the new procedure, the importers are required to digitally monitor the movement of the goods from the moment of import until export, including documentation of changes, in cases where repairs cannot be made. In addition, the importers are required to indicate, in the export documents, the repair number in accordance with the import declaration and to indicate, in the import documents, the catalog numbers of the products and the repair numbers (RMA).

From time to time, the Customs Authority is expected to conduct physical inspections to verify that import declarations match the export declarations. It should be noted that in cases of noncompliance with the provisions of the new procedure, the Customs may revoke the permit to import under item 810.

Companies that wish to be included in the new procedure need to make sure they are able to comply with the requirements of the new procedure. To do so, companies will need to be able to track the goods in accordance with the provisions of the new procedure. It is also necessary to arrange, in advance, the company’s registration at the Customs Authority, in light of the unique guidelines that will apply to each company.

The new procedure does not change the existing procedures with respect to item 212. however, it allows importing under item 212 goods that were manufactured in Israel.

For the new procedure >> Click here

We recommend contacting us if you expect significant difficulties from the implementation of the new procedure so that we can contact the Customs Authority on your behalf.

We will be happy to assist with any questions and clarifications that may be required.
Herzog Fox & Neeman