Comptroller: Tax Authority’s real estate records are flawed, unreliable

The Income Tax Authority’s information about the real estate market is incomplete, full of flaws, and unreliable, featuring significant failings in how it manages data about the state’s most valuable asset market, according to a State Comptroller report published this week.

The report found that more than 900,000 apartments, or roughly half of the 1.8 million homes in shared buildings that are listed in the Land Registry (Tabu), do not even appear in the Tax Authority’s database. That failure and others cited in the report call into question how taxes are calculated and collected for the 2.96 million residential units in Israel.

At the same time, the findings do not indicate that anyone has avoided paying taxes on a sale as a result of the failures, a representative from the comptroller’s office clarified to The Times of Israel.

Housing prices in Israel have skyrocketed in recent years, surging more than 77 percent between January 2014 and December 2024, the report said. That makes the Tax Authority’s ability to accurately assess taxes critical to national policy.

Between 2021 and 2023, taxes on real estate acquisitions totaled NIS 60.5 billion ($18 billion), or 8.4% of Israel’s direct tax revenues in those years.

The Tax Authority database is intended to serve as the “single source of truth” for Israeli real estate data, used by the Central Bureau of Statistics (CBS) to calculate the national housing price index and relied upon by the public to make informed purchasing decisions.

However, there were significant differences in the information found on the Tax Authority’s website and another site managed by the Housing Ministry, the comptroller noted.

In regards to these discrepancies, “the right hand does not know what the left hand is doing,” the comptroller report said.

The audit, conducted between August 2024 and March 2025, found hundreds of thousands of problematic pieces of data in the database, including false or contradictory information about an apartment’s size, the year the property was built, and the number of floors in the building.

Investigating nearly three million real estate transactions conducted since 1991, the report found that about 54,000 apartments were listed as being built in the year 1900, which it said was impossible. Some 452,678 real estate transactions were reported in buildings that were listed as having zero floors. In more than 47,000 instances where an apartment was sold more than once, there were differences of 20 meters or more in the size of the home listed in the transaction, despite these homes not undergoing any renovations in the interim.

In one case, the report found that a single building had 21 different years listed for when it was built, as recorded over 96 different transactions.

These failures, the report noted, “harm the quality, reliability, and completeness of the database.”

The report concluded by demanding immediate and fundamental reform to the Tax Authority’s real estate information infrastructure, noting that it is not only outdated and inefficient but also presents a challenge to the state’s ability to manage the financial foundation of its most significant assets.

In response to the report, the Tax Authority said its data is based on taxpayer filings, and that it has a system to prevent “unusual” filings but does not check them for accuracy. It said it will examine the possibility of integrating additional alert systems in the future.