Prices of tickets on buses and trains will rise 4.7% on January 1.
Public transport fares will rise 4.7% on January 1 as part of the bi-annual price increase. The rise is justified by a 2% VAT increase since October 2011 and a 3.68% rise in the Consumer Prices Index (CPI) between October 2011 and October 2013 (not the general index but rather than periodical adjustment index).
According to a government decision in 1997, fares on buses and trains are adjusted twice yearly on January 1 and July 1 according to the rise in the CPI and VAT. Increases are calculated according to price changes in the previous two years.
Transport Minister Yisrael Katz has failed in attempts to persuade the Finance Ministry not to implement the hike. Katz said, "The Ministry of Transport makes great efforts to increase use of public transport and increase its attractiveness compared with private cars. It must be remembered that the profit to the economy from cancelling the hike would be more than the addition to income from the fare hike."