Israel Approves Fuel Tax Cut to Lower Gas Prices After Record High
Translated & summarized from Arab48 by baba
The story in 5 lines · by baba
- Israel approves fuel tax cut to lower gas prices.
- New price to be 7.77 shekels per liter after record high.
- Reduction implemented via lower fuel excise tax.
- Decision requires special approval due to election period.
- Tax cut costs state an estimated 150 million shekels monthly.
The Israeli government's legal advisor approved a plan by Finance Minister Bezalel Smotrich on Thursday to reduce the price of gasoline by 50 agorot per liter, effective early next week. This reduction will be implemented by lowering the fuel excise tax, known as 'بلو' (بلو), a move similar to one approved by the minister last month.
This decision comes after the price of a liter of 95-octane gasoline in self-service stations reached a record high of 8.27 shekels, an increase of 52 agorot from the previous month. The Ministry of Energy and Infrastructure attributed this surge to a nearly 13% rise in global gasoline prices, driven by increased oil costs and concerns over energy supply stability. A roughly 3% appreciation of the dollar against the shekel also contributed to the higher fuel costs in Israel.
Minister Smotrich had pledged to offset the price increase by further reducing the fuel tax. Because Israel is in an election period, the plan required approval from the government's legal advisor, which was granted on Thursday. The Finance Ministry is expected to publish the order for public comment later on Thursday, with Smotrich anticipated to sign it on Sunday. If all procedures proceed as planned, the price reduction is likely to take effect on Sunday night or Monday morning.
Following the cut, the maximum price for a liter of 95-octane gasoline in self-service stations is expected to be 7.77 shekels, with full-service stations costing an additional 26 agorot. Without the tax reduction, prices would have remained at 8.27 shekels for self-service and 8.53 shekels for full-service.
The government's decision, while providing immediate relief to drivers, will result in a temporary decrease in tax revenue. Estimates suggest that a 50 agorot per liter reduction in the fuel tax costs the state approximately 150 million shekels per month. The longer the reduction remains in effect, the greater the cumulative loss of tax revenue for the government.
Read the original at Arab48
