Israel plans to increase its defense budget by almost 40 billion shekels ($13 billion), or about 2 percent. of its gross domestic product to finance the war with Iran, said a Finance Ministry official who spoke on condition of anonymity discussing plans that have not yet been made public.
Continued below the video:
The measures are part of the revised 2026 budget, which will be debated and possibly voted on late Tuesday in Prime Minister Benjamin Netanyahu's office, Bloomberg reported. The budget will then need to be approved by parliament by the end of the month.
|
Adam Ziemienowicz, Mateusz Krymski / PAP / photos
The defense budget will be increased by 28 billion shekels, a an additional PLN 10 billion will be allocated to reserves for possible military needs – said the official.
Israel's war spending. Billions of dollars and thousands of reservists came into play
Defense, the largest item in the spending program, will total 140 billion shekels — a 115 percent increase. more than in 2023, before the war in the Gaza Strip. The total spending plan will now amount to nearly PLN 700 billion.
The additional funds are intended mainly to supplement the military inventory and salaries of reserve soldiers.
The previous budget proposal included a limit of PLN 40,000. reserve soldiers for this year, with a maximum 55-day service period for each. However, since the beginning of the war with Iran in late February, the army has drafted over 100,000. reservists.
See also: The war in Iran is costing a fortune. The budget has already been exceeded many times
Israel goes into debt to fight the war
The deficit target, previously set at 3.9%, is likely to be increased, although it has not yet been determined by how much. This will probably be decided at Tuesday's government meeting, Bloomberg reports.
See also: This is how much the US spent in the first two days of the war. Donald Trump has a new plan
The government's debt has skyrocketed since the beginning of military retaliation for the Hamas attack in October 2023., peaking at almost 280 billion shekels in 2024 and remaining high at 200 billion last year.
Deficit exceeding 3.9%. may result in an increase in Israel's debt-to-GDP ratio, which currently stands at almost 69%. Under Israeli law, the vote on the budget must take place by March 31.
Israel and the US launched airstrikes on Iran on February 28. Since March 2, Israel has also been conducting attacks on Hezbollah targets in Lebanon, after the organization joined the war on Iran's side and attacked Israel. In response, the government in Beirut declared all Hezbollah military activities illegal.
Source: Bloomberg, PAP
