Photo Credit: Avshalom Sassoni / Flash 90
Finance Minister Bezalel Smotrich, March 2, 2023.

Finance Minister Bezalel Smotrich on Monday submitted the state budget and the attached arrangements bill for the years 2023-2024 to the Knesset plenum. Both bills were put to a vote on one of Israel’s most explosive days, with right- and left-wing opponents vilifying one another, and blaming each other for the anticipated fall of democracy. Under such volatile circumstances, it was a welcome gesture for the Knesset to do some things calmly and routinely. After their approval by the plenum (if Israel still has a democratically elected government), the two bills will be sent to committee for debate and amendments. The final bills will be submitted for a second and third vote in the Plenum in about two months, God willing.

The state budget for 2023 will be about NIS 484 billion ($136 billion) and for 2024 about NIS 513 billion ($144 billion).


“In preparing the proposed budget we saw before our eyes the great burden placed on the shoulders of the citizens of Israel and worked hard to fight the cost of living that makes life difficult for every citizen,” Minister Smotrich introduced his first budget since taking office.

“The economic challenges we are facing are not simple,” Smotrich continued. “Our economic horizon is not clear. The interest rate increases in the world, which are necessary to fight inflation, are shaking the global financial markets, and impacting the economic activity of many businesses and households. The crisis in the banking sector in the US and Europe exacerbates the uncertainty in the markets and may lead to a slowdown in global growth and deterioration in forecasts.”

Nevertheless, Smotrich declared, “I said in the past and I’m still saying today that here in the State of Israel, we have an opportunity to be an island of stability in a turbulent global economic sea.”

According to the finance minister, the 2023-2024 budget includes plenty of good news: significant budget additions in a large number of areas, including in social services, promotion of significant infrastructure projects, and a budgetary emphasis on boosting the country’s security.

The new budget includes the expansion of the health ministry’s budget to upgrade the public healthcare system; an increase in the education system’s budget; and a boost to encouraging and absorbing Aliyah.

There will also be an improvement of public infrastructure, a massive investment in transportation with a five-year plan of NIS 26 billion ($7.2 billion), and investments in energy transition, including the deployment of a gas distribution network and charging stations for electric vehicles.

The IDF will be the beneficiary of a new multi-year, multi-billion-dollar plan; and the national security system will be able to hire 3,000 new police officers.

Smotrich also introduced the first budget allocations of the profits of the Fund for the Citizens of Israel (a.k.a. the wealth fund), which is based on a share of the profits of the natural gas explorations. These funds will go to upgrading public infrastructure in education and mental health.

Also submitted with the new budget: a national infrastructure law that will speed up the implementation of infrastructure projects and cut their construction time in half; a broad housing plan through a fund to increase investments in the residents and incentivize housing construction; significant steps to promote competition and reduce monopolies in the food and agriculture market, in banking, insurance, and the automobile market; and a long list of steps to reduce bureaucracy and regulation for the business sector, including removing excess regulation on food importers and adapting import inspections to the European standard, cutting the taxation bureaucracy, and simplifying the licensing of new industrial projects.

Minister Smotrich concluded: “Citizens of Israel, the State of Israel, and Israeli society are going through difficult times, but as a country, we are strong and will continue to build the State of Israel for the benefit of all Israeli citizens. With God’s help, we will pass the budget and continue to work for you.”

Good luck.

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