After 15-hour debate, Knesset passes deficit-busting budget

At around 3 a.m. Tuesday morning and after 15 hours of debate, the Knesset passed the 2013-2014 state budget by a vote of 58 to 43. The budget will be NIS 395 billion ($110 billion) for 2013, and grow to NIS 405 billion ($113 billion) in 2014.

The vote was able to go ahead after Prime Minister Benjamin Netanyahu came to a compromise with leaders of the opposition Monday night, who had submitted 4,700 reservations to the budget law, each of which demanded a roll call vote, promising to greatly extend the process.

Netanyahu agreed to postpone a vote on the controversial governance law in exchange for the passage of the Economic Arrangements Law — a corollary to the budget — which was approved in its final reading by a vote of 56-41. The law includes raising the income tax rate by one to two percent and reducing child allowance payments.

The budget was sharply criticized by opposition leader Shelly Yachimovich (Labor), who accused Netanyahu and Finance Minister Yair Lapid of “slinking” away from the Knesset immediately after the vote because they were ashamed of the budget they had passed.

“This budget hurts 99% of the public with a severity we haven’t seen in years,” charged Yachimovich. “It raises income tax, VAT, increases corporate tax exceptions, [and] cuts child allowances, health, social care, education.” She said the budget would not generate economic growth, but rather increase inequality and “rob the middle class.”

Yesh Atid MK Nissan Slomiansky defended the budget, saying it was good for Israel and would help the country dig its way out from under a NIS 40 billion ($11.2 billion) deficit.