Israel's fiscal deficit narrows further

Israel's fiscal deficit in the 12 months ending February 28, 2022 narrowed to 2.2% of GDP, or about NIS 35 billion, the Ministry of Finance reports. The fiscal deficit has been consistently narrowing over the past year from 3.2% at the end of January, 4.5% at the end of 2021 and 11.7% at the end of 2020, in the midst of the Covid pandemic. In February, the Ministry of Finance reported a rare budgetary surplus of NIS 4 billion.

The Ministry of Finance attributes the narrowing of the fiscal deficit, among other things, to an exceptional rise in government revenues from taxes in February 2022 to NIS 34.8 billion. Government revenues from taxation in the first two months of the year were NIS 82.2 billion, 23.7% higher than the corresponding period of 2021. Another reason for the smaller deficit was the continued decline in expenditure on economic assistance, as set by the previous government, for those hit by the Covid crisis.

Israel's fiscal deficit was 3.1% in the 12 months to the end of February 2020, on the eve of the Covid crisis.

Published by Globes, Israel business news - en.globes.co.il - on March 8, 2022.