Israel's Finance Ministry has issued a new lottery permit that lets small businesses run modest giveaways without a supervisor and without reporting to the ministry. Director General Israel Malachi signed it in early November 2026, and it takes effect in January 2027. It replaces the general permit in force since 2010.
The change matters for anyone who promotes a business on social media. A post that says "one follower wins an iPhone" is a lottery under Israeli law, and until now it came with paperwork most small shops never did.
The rules until the end of 2026
In Israel a lottery is prohibited unless a permit allows it, and a breach can carry up to three years in prison. The 2010 permit allowed commercial lotteries only if the organizer appointed a supervisor (a lawyer or an accountant), published terms and conditions, and reported to the Finance Ministry. A business that gave away a product to a random follower without all of that was breaking the law, however small the prize.
The old permit stays in force until January. A giveaway planned for the holidays or for year end still has to meet the 2010 conditions.
Who qualifies for the exemption
A business qualifies when it is not part of a retail chain, its annual turnover is no more than ₪10 million, and the total value of prizes in the campaign is no more than ₪10,000.
Such a business may hold up to two giveaways per fiscal year with no supervisor and none of the reports the regular route requires. The ₪10,000 can be split across several prizes, as long as the campaign total stays within the cap.
Conditions that still apply
Minors may not take part, and the giveaway may not be advertised in a way aimed at them. A business with a young following should check this before it posts.
The business may not charge a separate fee to enter. It may require a purchase of its own product or service, but it may not raise the price because of the giveaway. The 2010 permit had a similar condition.
The permit sets further conditions for the exemption that have not been published in full detail yet. Before a first giveaway in January, read the full text of the permit or ask your accountant.
Larger campaigns follow the regular route
A business that misses any of the conditions, for example a campaign with ₪15,000 in prizes or turnover above ₪10 million, stays on the regular route, which is also changing. A single prize is capped at ₪200,000 and all prizes in a campaign at ₪2 million. Cash, alcohol and tobacco can no longer be given as prizes.
The supervisor on the regular route must now be a licensed lawyer. An accountant can no longer serve, and neither can anyone employed by the organizer. The waiting period between campaigns drops to 90 days from the last draw, down from 120. The old limit of two campaigns a year does not appear in the new regular route.
Non-profits get a general route for fundraising draws
Israeli non-profits that raise donations through lotteries needed a separate permit for each campaign. Under the new permit, a qualifying non-profit can sell raffle tickets under the general route, once per fiscal year, for up to 120 days. A single prize is capped at ₪150,000 and all prizes at ₪500,000, with room to go up to 1% of the organization's turnover. It still needs a supervisor and still has to report.
To qualify, a non-profit needs a proper management certificate, at least half its income from sources other than government support, and a top salary no higher than that of a government ministry director general. Organizations whose main activity is education, including schools, yeshivas, pre-army academies and universities, are excluded.
Before the first giveaway in January
A small business planning a giveaway in 2027 should check its turnover for the year, the value of prizes in the campaign, and how many giveaways it has already run in the same fiscal year. Keep a record of each prize's value and the draw date, so you can show the business stayed within the caps. If the prize was bought as a business expense, its invoice also documents its value.