Israel

Cabinet passes austerity package


Published

The Israeli Cabinet passed a package of austerity measures by 20 votes to 9 votes yesterday.

The package includes:

• 1% income tax rise for those earning more than 8,881 shekels (£1,572; $2,193) and below 41,830 shekels (£6,576; $10,330) per month from 2013

• 2% income tax rise for those earning 67,000 shekels (£10,533; $16,547) per month from 2013

• VAT to increase from 16% to 17% on Wednesday

• Tax increases on beer and cigarettes

• 5% average cut in ministry budgets (Education 1%, Internal Security 3%) this year and a further 3% next year

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