Israel to face 4% budget deficit unless spending cuts & tax hikes: Finance Minister

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Israel to face 4% budget deficit unless spending cuts & tax hikes: Finance Minister

On Sunday, the 12th of January 2020, the Israeli Finance Minister, Moshe Kahlon, said in a statement that the Middle Eastern country beside the Mediterranean Sea, might witness its budget deficit reaching at least 4 per cent of its entire GDP (Gross Domestic Product) over the coming years unless the Government could make a slew of sweeping adjustments in taxations including tax hikes in several sectors and could escape an additional spending of tens of billions of American dollars.

In point of fact, a political stand-off began in Israel about a year earlier which in effect had made it utterly difficult for the Caretaker Government to take major financial steps, since power of the caretaker government had been limited.

Nonetheless, Israel is set to hold its third election in less than a year on March this year, suggesting a 2020 budget might not come in to effect until mid-2020, while in the transitional period, Israel’s expenses would be based on 2019’s budget, said Israeli Finance Minister.

However, latest comment from the Israeli Finance Minister came against the backdrop of a growing uproar over an increase in spending on service sectors, wages of the police forces alongside public officials ahead of a March General Election, nonetheless, Kahlon accused the nation’s economy for his Ministry’s budget deficit adding the analysts had overestimated the Government revenue. Israel scored a budget deficit of 3.7 per cent last year, insanely beating an initial estimate of 2.9 per cent.