Prime Minister Benjamin Netanyahu gave a speech to the Knesset plenum yesterday, after 40 MKs signed a petition demanding a debate on the government's economic and security failures.
Commenting on the jump in the price of gasoline, Netanyahu said, "The price of gasoline here rises and falls, but mostly it rises, because the price of oil has risen from $50 a barrel to $100. There is no doubt that every addition by the government increases the burden on the price. That is why I asked National Economics Council chairman Eugene Kandel and ministries' director generals to propose alternatives to the excise on fuel. I will meet with the finance minister, who is returning from overseas today, and with Governor [of the Bank of Israel Prof. Stanley] Fischer. After consulting with them, I will make a decision and inform the public about what I decided. It won't take long."
Media reports state that Netanyahu plans to approve a plan to cut the price of gasoline by up to NIS 0.20 per liter. Half the reduction will be rolled onto the fuel companies, and the second half onto the government. The plan will cost the treasury an estimated NIS 4 billion a year. The Ministry of Finance is considering freezing a VAT cut to finance the lower price of gasoline.
Kadima chairwoman Tzipi Livni said in response, "It's very nice that you want to be perceived as the man whose eyes are open and heart is attentive the people's murmuring, but don’t forget that you are the man who raised the excise on fuel so that your coffers will be filled even more on the backs and at the expense of the citizens. You know perfectly well that there is no connection between the rise in the price of gasoline and the rise in the global price of oil. The people cannot handle the taxes you are burdening them with any more."
Published by Globes [online], Israel business news - www.globes-online.com - on February 3, 2011
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