24 hours late, Prime Minister Benjamin Netanyahu is giving his full support for Minister of Finance Yair Lapid and the budget cuts he presented to the government. Netanyahu said that, contrary to reports, he has no intention of changing the Ministry of Finance's budget proposal.
Netanyahu made the remarks this morning in China, just before he landed in Beijing. Despite his backing of Lapid, Netanyahu's aides say that no agreement has been reached about the size of the cut which will be needed in the defense budget. Netanyahu has not yet agreed to the NIS 4 billion defense cut, and he will probably discuss the issue after his return to Israel.
Netanyahu's aides went beyond denying reports that he would cancel some of the austerity measures, in order to avoid harming Lapid's proposal, saying that they believed that more cuts could be made. Netanyahu, notwithstanding his belated support for Lapid, still believes that more budget cuts are possible, including in public sector salaries, in order to close the remaining deficit.
Netanyahu attended a ceremony in Beijing today marking the signing of various cooperation agreements between Israeli and Chinese companies. "This is an expression of thanks to all of you, Israeli and Chinese business people. There is a perfect marriage between our mutual capabilities. The Israeli government stands firmly behind cooperation between Israeli and Chinese companies, and between Israeli research institutes and Chinese research institutes," he said.
Lapid did not wait for the government to approve the austerity measures, and yesterday, as part of the preparations for the 2013-14 budget, he signed an amendment to the customs and purchase tax ordinance to raise purchase tax on tobacco products from midnight today. The tax hike will raise the cost of a pack of cigarettes by NIS 2.50-3.
Published by Globes [online], Israel business news - www.globes-online.com - on May 8, 2013
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