Lapid presents budget for 2015: More funds for army, education, health
Ending weeks of political fighting over Israel's next budget, Finance Minister Lapid presented the 2015, saying 'this is a social budget' which will not force more taxes on middle class.
Finance Minister Yair Lapid presented on Sunday the goals of the 2015 state budget. "This is a social budget, which provides resources to improve education, health, and welfare, and everything which touches on the lives of Israelis."
Lapid and Prime Minister Netanyahu have been at odds over the budget. Netanyahu and Defense Minister Moshe Ya'alon have been fighting for a big hike in defense spending and were met with fierce resistance from Lapid, who refused to raise taxes and preferred to increase the deficit to foot the bill while Netanyahu preferred the former.
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In the press conference Sunday, Lapid stressed: "If the last budget was a crisis budget, the current budget is one of hope and promise. The social budgets will increase by billions of shekels this year."
Alongside the significant injection to the defense budget, the government will increase the Health Ministry's budget by 2.8 billion shekels, the Education Ministry's budget by 1.8 billion shekels, and the Internal Security budget by one billion shekels.
The government will also increase the assistance package for Holocaust survivors by one billion shekels.
The Labor party, which currently chairs the opposition, said in response that "if we had a shekel for every promise Lapid made, we could probably close Israel's deficit and stop collecting taxes. Besides putting an Israeli on the moon, Lapid has promised the public pretty much everything. It's nice to see that he still seems to believe himself, even though the public has long lost its faith in him."
The Yesh Atid chairman noted that the "defense budget will increase by 6 billion shekels and the deficit will rise to 3.4 percent. The original plan before Protective Edge was to pass a budget with a deficit target of three percent."
Lapid emphasized that he would stick by his promise to not raise taxes. "It is not secret that we were pressured to raise taxes, but we decided against it. The last thing the economy needs at this time is further tax increases. Our job is to push the economy forward. Instead of raising taxes we will finance through other sources, like the Jewish National Fund."
He said the Finance Ministry will "collect more from natural resources, improve tax collection, and continue the war on the black market. There is an unprecedented emphasis on small and medium businesses, as they are – across the world – the growth engines of the economy."
Regarding his flagship legislation in the housing field - the 0% VAT bill - Lapid vowed it would come into effect soon. "It's only a shame that certain interested parties tried to postpone the plan for political reasons, despite knowing it would change the housing market and lower prices." The comment seems more a veiled jab at the opposition than at the coalition, despite the fact Netanyahu had personally tried to freeze the bill.
When asked if he would quit, should the bill not pass, Lapid reiterated that the bill was a coalition breaker: "There will be no need for me to quit, the entire government would fall apart."
Despite the aforementioned, Finance Ministry officials said at the beginning of the press conference that the budget presented was not final yet. According to the head of the budget division, the final decision regarding the defense budget would be taken only after the holidays.
