#Why are Nvidia and Google requesting to pay taxes in US dollars?
Nvidia and Google have approached Israel’s Tax Authority with a request to fulfill their tax obligations using US dollars rather than the local shekel. This request arises from a notable appreciation of the shekel, which has increased approximately 20% against the dollar over the past year. For these companies, primarily generating revenue in dollars yet incurring expenses in shekels—such as salaries and office costs—this situation turns into a financial challenge, increasing their tax burden significantly.
The current exchange rate places the shekel at about 2.89 per dollar. This disparity creates a harsh financial reality for firms that earn mainly in dollars while their local expenses are pegged to a rising currency.
#What historical context supports this request?
Previously, Israeli authorities allowed tax payments in dollars, establishing a significant precedent. In March 2026, they approved dollar-denominated tax payments amounting to $32 billion, primarily to mitigate potential market disruption that could arise from large currency conversions. This included $2.5 billion from founders involved in the acquisition of Wiz by Google.
Nvidia also made a substantial tax payment to Israel recently, totaling around $1.287 billion. The request for dollar payments was initiated by both companies shortly after June 2, 2026. They focus their argument on the need for operational stability and predictability within a complex financial landscape.
#What factors contribute to the shekel’s continuous rise?
The shekel’s appreciation is largely a byproduct of Israel's thriving tech export sector. High demand for Israel's technology products and talent leads to significant capital inflows, further driving up the local currency's value. This places additional pressure on companies like Nvidia and Google that maintain robust research and development and business operations in Israel, as their revenues predominantly originate in dollars. The recent spike in Nvidia's revenue from $325 million to approximately $1.47 billion underscores the urgency of aligning tax responsibilities with actual revenue streams amid fluctuating currency conditions.
#How does Israel’s crypto disclosure program relate to this situation?
In conjunction with this discussion, Israel's Tax Authority had introduced a voluntary crypto disclosure program in 2025, which aimed to bring in 2 to 3 billion shekels. Unfortunately, the outcome was minimal, with only about 41 million shekels collected from a limited number of filings.
Both Nvidia and Google's request to pay taxes in dollars and the lackluster results of the crypto disclosure initiative highlight the challenges the Israeli government faces in taxing assets and operations that cross international borders, where money can shift at lightning speed.
#What does this mean for investors?
If the Tax Authority permits Nvidia and Google to pay their taxes in dollars, it could set a precedent for other multinationals operating in Israel. This shift would force the Israeli government to handle the implications of receiving taxes in a foreign currency, raising potential concerns regarding fiscal sovereignty. Furthermore, it could complicate monetary policy as large corporate taxpayers essentially deviate from local currency contributions.
Given the March precedent of approving a substantial dollar payment, it seems political support exists when the amount is significant enough to potentially destabilize the market. However, whether this flexibility will extend to routine tax obligations remains uncertain.