ALBAWABA – The Israeli government approved its new budget for 2025, which aims to increase military spending through tax hikes and spending cuts, continuing the focus on war costs for the second consecutive year.
Israeli government raises 2025 budget to cover war expenses
The Israeli government increased its 2025 budget by millions of shekels to cover ongoing war expenses in Gaza and Lebanon. However, the economy is struggling due to a labor shortage as many workers join the military.
It is worth mentioning that the Israeli Ministry of Finance is anticipating an approximate growth rate of 0.4% for 2024, compared to previous estimates of 1.1%, according to Reuters.
Bezalel Smotrich Finance Minister of Israel stated: “The main goal in the 2025 budget is maintaining the security of the state and achieving victory on all fronts, while maintaining the resilience of the Israeli economy.”
The new budget proposed by the Israeli government is estimated at approximately NIS 40 billion and will include tax increases and spending cuts. (Shutterstock)
Additionally, multiple sectors, including technology, construction, and agriculture, were impacted by the war, affecting the overall economy. A significant number of Israeli workers joined the military, while thousands of Palestinian workers were suspended for security reasons.
The new budget proposed by the Israeli government is estimated at approximately NIS 40 billion and will include tax increases and spending cuts. The government aims to reduce its budget deficit, which reached 8.5% of Gross Domestic Product (GDP).
Benjamin Netanyahu, Prime Minister of Israel, stated that war expenses may increase as the war enters its second year with no signs of ending.
