January 8, 2018 / 11:48 AM / 9 months ago

Israel sets 2019 budget at 479 billion shekels, deficit target 2.9 percent/GDP

JERUSALEM (Reuters) - Israel’s finance ministry published its 2019 state budget draft on Monday, proposing to spend 479.4 billion shekels ($139 billion) next year.

The total is nearly 20 billion shekels more than the already approved 2018 budget of 460 billion and includes 100 billion shekels of debt payments and another 39 billion for interest expenses.

The ministry set the budget deficit target at 2.9 percent of gross domestic product, higher than a maximum target of 2.5 percent of GDP as required by current law. The government frequently sets targets above what is allowed by law.

In 2017, the deficit was 1.97 percent of GDP, well below a target of 2.9 percent due to higher than expected tax revenue.

The ministry also proposed a deficit target of 2.5 percent of GDP in 2020 versus a current law of 2.25 percent, with the deficit falling a quarter-point a year until it is forecast to reach 1.5 percent in 2024.

The highest outlay in the 2019 spending package is education at 57 billion shekels, followed by defence at 56 billion and social security at 44 billion.

Cabinet ministers are expected to debate the budget plan in the coming days and then vote on it.

Reporting by Steven Scheer, Editing by William Maclean

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