The Cabinet today approved Minister of Finance Yair Lapid's proposal to dramatically reduce growth in the state budget and government expenditure. This follows three years in which the state budget has expanded. According to the proposal, the 2015 budget will increase by just 2.5% instead of 4%, making it NIS 4.3 billion less than currently planned.
Lapid said the step will, "moderate the need for raising taxes in 2015 and afterwards."
However, Lapid declined to commit to lowering taxes including VAT, even next year. He said, "The meaning of this step is preventing a dramatic rise in taxes and preventing the ballooning of government expenditure beyond what is required.
Although the change seems a technical one, it is a drastic change in direction of current government policy which seeks to significantly reduce the government's role in the economy.
Published by Globes [online], Israel business news - www.globes-online.com - on December 29, 2013
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