Israel removes all remaining tariffs on US imports

Israel and the US signed a free trade agreement in 1985, and some 98% of goods are tax-free.

Finance Minister Bezalel Smotrich speaks at the Knesset, in Jerusalem, February 17, 2025 (photo credit: MARC ISRAEL SELLEM)
Finance Minister Bezalel Smotrich speaks at the Knesset, in Jerusalem, February 17, 2025
(photo credit: MARC ISRAEL SELLEM)

Israel has canceled all previous tariffs on products from the US, a joint statement from the Prime Minister's Office, Finance Ministry, and Economy and Industry Ministry confirmed on Tuesday.

The Finance Committee approved it, and the Economy and Industry Minister, Nir Barkat, signed the order to amend the Trade Tariff and Protective Measures Order.

A free trade agreement between the US and Israel signed in 1985 had already led to nearly all imported goods from the US being fully exempt from tariffs.

The joint statement clarified that, due to this, the tariff reduction will apply to a very limited number of products, primarily in the food and agricultural categories.

The removal of remaining tariffs would expand the strategic relationship between the two countries, the statement added.

It would also benefit Israeli consumers with a potential reduction in the cost of living due to the lowered prices of food and agricultural products from the US.

Political leaders respond

Prime Minister Benjamin Netanyahu commented, "Canceling the tariffs on American goods is another step in the policy led by my governments for over a decade to open the market to competition, introduce diversity into the economy, and reduce the cost of living."

"In addition to the economic benefits for the economy and Israeli citizens, this move will further strengthen the alliance and ties between Israel and the United States. We will continue to work on reducing barriers and tariffs and reinforcing our special relationship with the United States,” Netanyahu added.

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Finance Minister Bezalel Smotrich commented, "The current US administration presents a real opportunity to reshape the strategic economic relationship between our countries. This move will deepen our ties, reinforce the US as a key economic partner, and pave the way for stronger cooperation."

"We’re committed to expanding trade, encouraging innovation, and building on the shared goals outlined by both finance ministries. Eliminating these tariffs supports Israel’s efforts to lower the cost of living and will help drive more competition—especially in the food sector—for the benefit of Israeli consumers," Smotrich added.

Economy and Industry Minister Nir Barkat said "We continue to strengthen the Israeli economy and the strategic ties between the countries. The cancellation of tariffs on imports from the United States is a complementary step to the longstanding trade relations between the two countries, which will promote additional economic cooperation in the future and lead to a reduction in imported product costs."

"We will continue working together to open new markets and create economic opportunities that will strengthen the Israeli economy and our solid partnership with the United States, while maintaining local production,” he added.