Israel takes on debt, cuts and raises taxes for war | News in brief

The Israeli government has reached an agreement on next year’s wartime budget at the end of long negotiations.

The government proposes numerous cuts to various ministries and an increase in value added tax from 17 percent to 18 percent.

Despite this, Israel will have to take on tens of billions of dollars in additional debt next year. The amount of additional debt corresponds to 8.5 percent of the country’s gross domestic product.

The country’s parliament still has to approve the budget proposal.

Israel’s attacks on Gaza and Lebanon have strained the country’s economy. International rating agencies have downgraded Israel’s credit rating due to the prolongation of the wars. Israel’s economic growth has also stalled this year.

Reuters

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