The draft state budget for 2025 was approved by the government – 23 ministers voted for the draft state budget, seven voted against it, and two did not take part in the vote.
Minister of National Security Itamar Ben-Gvir, amid a conflict with the Ministry of Finance over cuts to the police budget, announced that his faction will vote against the 2025 budget in both the government and the Knesset. At the government vote, he carried out this threat; all three ministers voted against it, after which they left the meeting room.
Ben-Gvir threatened that the faction he led would vote against the budget in the Knesset. There are three representatives of the Otzma Yehudit party in the government: Minister of National Security Itamar Ben-Gvir, Minister of Aliyah and Integration Ofir Sofer and Minister of Heritage
Amichai Eliyahu.
The total budget is 607.4 billion shekels, while the opposition has already stated that this is a “political bribe” to coalition members in the amount of 4.1 billion within the framework of coalition agreements, while the expenses of the average Israeli family will increase, according to the statement Yesh Atid leader Yair Lapid, 20 thousand shekels per year.
The draft budget increases the planned deficit to 4.3%, which is higher than previously planned. An additional 20 billion shekels will be allocated for the needs of the defense system, and Prime Minister Benjamin Netanyahu is already admitting that this amount is not enough, and that amendments will have to be made in the future to increase the budget of the Ministry of Defense.
Shas Chairman Aryeh Deri has won a planned freeze on social benefits, and to compensate for this, contributions to Bituach Leumi will be significantly increased: according to the economic publication The Marker, workers will pay three times more than now. The publication notes that this point was read out orally, and the ministers approved it, although some of them did not even understand its meaning.
Thanks to Deri’s intervention, adjustments to social benefits for disability, old age, subsistence level and others, which are adjusted annually in accordance with the price index, will not be frozen. However, child benefits will be frozen.
The increase in Bituach Leumi contributions will apply to all workers, including low-wage workers. If currently workers earning up to NIS 7,522 per month pay a contribution to the National Insurance Institute in the amount of 0.4% of their salary, and the employer puts aside another 3.55%, then, in accordance with the decision proposed as part of the state budget for 2025, the total contribution will be increased by 1.6% of wages, and the employer and employee will share this increase among themselves (0.8% of wages each).
According to THe Marker’s calculations, if until now low-wage workers paid about 30 shekels of their salary, after the changes they will pay 90 shekels, that is, three times more. Their employers will pay an additional 0.8% on top of the 3.55%, which amounts to an additional NIS 720 per year.
Currently, the minimum contribution to Bituach Leumi for those who do not work is 87 shekels and 116 shekels for the minimum health care tax. The minimum contribution to Bituach Leumi will increase by about 40 shekels to 130 shekels per month. The Ministry of Finance also proposed to cancel the discount on contributions to Bituach Leumi for students and yeshiva students (avrekhs), who pay only 29 shekels per month, and transfer them to the minimum contribution for non-workers, but representatives of the Ministry of Finance were unable to push through this change. Payments by students and graduates to the National Insurance Institute will increase by about 15 shekels to 45 shekels.