Israel approves USD 19 billion budget increase due to war

Pic/AFP

On Wednesday, the Knesset approved an update to the state budget for 2024 that includes the expenses that arose due to the "Iron Swords" war against the terrorist group Hamas in Gaza. The updated state budget is about 584 billion Shekels (USD 162 billion) and reflects an increase of about 70 billion Shekels (USD 19.4 billion) in spending.

The budget includes a significant addition to defense spending, both for the reimbursement of the fighting expenses and for the strengthening of the army, the protection of settlements near Gaza and security components for the settlements, extensive support for the mental health system, the budgeting of the Takuma administration for the reconstruction of the surrounding area, the evacuation of settlements and support in the acceleration of the high-tech industry and the real estate industry.

The budget update anchors a projected deficit of about 6.6 per cent of GDP for 2024, and includes adjustments in the amount of about 20 billion Shekels (USD 5.6 billion) in 2024 and 2025.

The government also approved several measures to increase state revenues: taxing bank profits as well as reducing the recovery day for salaried employees as part of an agreement with the Histadrut - Israel's national labor federation.

Director General of the Ministry of Finance, Shlomi Heisler: "The updated budget for 2024 will enable the implementation of the war efforts, strengthening the resilience of the Israeli economy and will allow the reservists and reserve networks to be rewarded for their contribution to the security of the state."

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