HMRC threatened with legal action over Israeli settlement trade
Sarah Taaffe-Maguire reports in Sky News on 4 September 2026:
A non-profit legal group has threatened to sue HM Revenue and Customs (HMRC) for allegedly allowing Israeli settlement trade to enter the UK tariff-free. Agricultural goods from Israeli settlements, in areas like the West Bank, have entered the UK in violation of trade rules, according to a letter sent by law firm Leigh Day, representing the Global Echo Litigation Center.
Some products entering the UK were labelled Israeli but in fact came from occupied Palestinian territory, according to the July correspondence, seen exclusively by Sky News. Settlement imports are supposed to be subject to tariffs, while Israeli products get preferential tax treatment and mostly enter the UK levy-free.
There had been a “failure” by HMRC to determine the true origin of UK imports, the letter read, citing Global Echo’s four-year investigation, which suggests “current processes adopted by HMRC to verify the origin of Israeli products are flawed”. This has meant settlement products “unlawfully benefitted” from preferential tax treatment, the letter continued.
It outlined five companies, identified from 357 invoice declarations, which the non-profit said regularly source agricultural products from settlements but declare the origin as Israel.