Israel begins to fight inflation
2023.01.11 15:06
Israel begins to fight inflation
By Tiffany Smith
Budrigannews.com – In announcing preliminary measures to reduce inflation on Wednesday, Prime Minister Benjamin Netanyahu stated that Israel will either cancel or reduce recent increases in the costs of water, energy, and property taxes.
In a televised news conference with Netanyahu, Finance Minister Bezalel Smotrich stated that the government would pursue the plan while adhering to fiscal responsibility.
Netanyahu, who began his sixth term as premier last month atop a religious-nationalist coalition government, stated, “Our economy has entered an inflationary spiral.” Now is the time to turn the wheel around. We cannot wait until the discussions about the budget.”
Subsidies for gasoline, a halt to property tax hikes, and a reduction in anticipated price increases for water and electricity were among the measures he announced.
However, neither he nor Smotrich specified the source of the additional funds.
The Bank of Israel predicts that Israel’s annual inflation rate will fall to 3% by the end of 2023. In November, Israel’s annual inflation reached 5.3%, its highest level since October 2008. The official annual goal for Israel is between 1% and 3%.
The Finance Ministry reported that Israel’s 2022 budget surplus was 9.8 billion shekels ($2.8 billion), or 0.6% of GDP. This was the country’s first surplus in decades. After deficits of 4.4% of GDP in 2021 and 11.3% in 2020, this occurred. It wanted a deficit of 3.9% of GDP in 2022.
The government’s plan was described as “a first step in the right direction to lower the cost of living and increase economic growth” by the Manufacturers’ Association, which represents approximately 1,500 businesses and 400,000 employees.
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