07.25.12, 00:58–Finance Minister Yuval Steinitz is due to present a 1% VAT hike to the cabinet for approval on Monday, along with across-the-board cuts to the government budget comprising close to NIS 1 billion (roughly $245 million).

Taxes on alcohol and cigarettes are set to rise, along with an expected gasoline price hike of 40-50 agorot per liter that is the result of the high dollar exchange rate and rising oil prices.

For many Israelis, this marks another blow in an already frustrating socioeconomic reality. “All the price hikes are killing us,” said Rachel Cohen, 52, from Jerusalem. “The economy might have grown but people are worn out.”

In addition to raising taxes and cutting spending, Steinitz plans to ask the Treasury to add another 600 workers to the Israel Tax Authority to improve its tax collection capability.

Prime Minister Benjamin Netanyahu said that “Anyone who says that it’s possible to spend without thinking, without coverage, for populist purposes – is simply endangering the State of Israel and can easily bring it to the situation we have seen in leading European economies that are going broke. That hasn’t happened here – I won’t let it happen here.”…Read More>>

Share/Bookmark