TAX DRAMA: Bar Refaeli reportedly was arrested in Israel for failing to report income earned abroad and goods received as part of endorsement deals, including two luxury cars.

On Thursday a court agreed to release her on $193,000 bail. The Israeli model’s passport was also confiscated for 180 days and in order to leave the country, she must seek permission from the authorities and pay a $64.000 bond.

Allegedly the model was living in apartments that were registered under her mother’s and brother’s names in order to hide the fact that she was a resident in Israel; non-residents are exempted from declaring income earned abroad.

Refaeli has just released a campaign with Agent Provocateur, where she appears as a barn girl in the label’s lingerie. She has also been regularly traveling to Israel to host the local “X Factor”.

She has denied committing any offense and her lawyer has dismissed this accusations as a “civil dispute,” according to reports.

“There is no drama. No one cheated anyone else. It will all clear up soon,” said Giora Aderet to the NRG news Web site.

One Management, the model’s agency in New York, declined to comment.

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