The government approves the Budget and the Arrangements Law

At the end of a long evening meeting, the government approved the economic
program for 2013-2014 with a majority vote of 21 to 1.

(Communicated by the Ministry of Finance Spokesperson)

The program includes numerous accomplishments, including a historic decision
imposing the teaching of core subjects in the entire education system,
launching the “Going to Work” program with incentives to encourage
employment and further develop the job market, reducing child allowances and
denying them from salary earners of more than NIS 800,000 a year,
implementing the recommendations of the Kedmi Committee to reduce food
prices, fighting the black economy and cutting the salaries of Government
Ministers as well as Members of the Knesset.

In addition to a reduction of NIS 3 billion in the defense budget, it was
decided not to revoke the VAT exemption on tourism services, and instead to
raise corporate tax by an additional 0.5% (1.5% total).

It was also decided to impose a lateral reduction of 2% in the 2013 budget
and 3% in the 2014 budget, a total amount of one billion Shekels with the
exclusion of the defense and welfare budgets from any further cuts.

Minister of Finance Yair Lapid said: "The approval of the budget for
2013-2014 is the first step in the changing of the order of life in Israel.
The law for equal burden in military and civil service as well as the
financial burden will shortly be brought to the government for approval and
the Housing Cabinet will begin to implement a national housing program that
will cause a reduction in housing prices in Israel. The budget will be
accompanied by a comprehensive package of measures which include imposing
taxes on large corporations that are currently paying negligible taxes on
their profits and formulating reforms in a dialogue with the Israel Electric
Corporation and the Ports."