Booking.com fined NIS 2.5m. for concealing value-added tax

The website Booking.com had been imposed a fine of NIS 2.5 million after concealing a value-added tax (VAT) to its purchases from consumers.

The website systematically presented its prices in shekels without including the VAT rate applicable. This was in violation of the Consumer Protection Law, which requires the presentation of a "total price" and explicitly lists the mandatory taxes applicable to the transaction as part of the total price. 

The Booking.com website now has prices that include the VAT for Israeli consumers who purchase accommodation as of this week.

The website stated in response that: "We at Booking.com are constantly working to improve the experience of using our platform and ensure more transparency, choices and value for travelers and our accommodation partners."

Reaching an agreement

The website also stated that they had reached an agreement with the Consumer Protection Authority (CPA), where since the beginning of this month, 17% of the VAT will be included in the price that is already displayed. This was following a legal procedure that was conducted by the CPA.

Leaving out the VAT is also a practice that causes the consumer to be misled as to the price of the service. The consumer only discovered the real cost of the transaction after it has been paid. This practice also misled the consumers attempting to do price comparisons before their purchases.

Moshe Cohen, Arnold Nativ, and Matan Wasserman contributed to this report.