Israel's budget deficit for the 12 months ending in March has widened to 4% from 3.1% the previous month, the Ministry of Finance reports. The rise reflects the growth in public spending and fall in tax revenues over the past month as the coronavirus crisis began to bite. The Ministry of Finance said, "In the coming months the sharp rise in the budget deficit will continue as a result of the crisis." The latest figure also reflects a new methodology in calculating government expenditure to include debt repayment. RELATED ARTICLES Israel's budget deficit narrows further Bank of Israel cuts interest rate to 0.1% Israeli gov't completes largest-ever bond issue An indication of where the budget deficit is heading comes from the fact that the deficit for March was NIS 15.9 billion compared with NIS 3.6 billion in March 2019. Tax revenues were down 17.6% in March compared with March 2019 and government revenues were down 8.1% in the first quarter of 2020 compared with the corresponding quarter of 2019. The main fall in revenue was because the National Insurance Institute diverted money from the state coffers through the purchase of government bonds for use as unemployment payments. Thus the National Insurance Institute has not passed any money onto the government this year compared with NIS 6.2 billion last year. Tax collection fell 7% in the first quarter. Published by Globes, Israel business news - www.globes-online.com - on April 8, 2020 © Copyright of Globes Publisher Itonut (1983) Ltd. 2020
