Israel's 2025 Budget Faces Internal Strife Amid Coalition Tensions
Israel's Knesset has narrowly approved the 2025 budget in a first reading, with a vote of 59-57, despite significant dissent from within Prime Minister Benjamin Netanyahu's coalition government. The budget, which totals approximately $210 billion, is heavily influenced by the ongoing conflicts in Gaza and Lebanon, and it includes austerity measures aimed at controlling a rising budget deficit that has reached nearly 8% of GDP due to war expenditures.
The approval process has highlighted deep divisions among coalition partners, particularly between the far-right factions. Israeli National Security Minister Itamar Ben-Gvir, leader of the Otzma Yehudit party, voted against the budget, calling for the dismissal of Attorney General Gali Baharav-Miara. Ben-Gvir's opposition stems from her support for an independent investigation into Israel's actions during the recent Al-Aqsa Intifada and her resistance to proposed judicial reforms. He has publicly stated that his party will not adhere to coalition decisions, including those regarding the budget, and has urged the government to act decisively against the attorney general.
In response, Finance Minister Bezalel Smotrich criticized Ben-Gvir for aligning with opposition forces and jeopardizing the coalition's stability during a time of war. Smotrich emphasized the importance of maintaining the coalition's unity to capitalize on opportunities for settlement expansion in the West Bank.
Budget Details and Future Implications
The proposed budget includes significant spending cuts and tax increases totaling 37 billion shekels ($10.29 billion) to address the fiscal deficit. Defense spending is projected to reach NIS 108 billion ($30 billion) in the coming year, reflecting the ongoing military engagements. The budget will undergo further scrutiny in the Finance Committee and other Knesset committees before its anticipated final approval in January 2025.
Should the budget not be approved by March 31, new elections could be triggered, adding to the political uncertainty in Israel. Netanyahu's coalition, which previously held a 64-56 majority, has seen its stability tested as it navigates internal conflicts and external pressures related to the ongoing conflicts in the region.
