Israel Fuel Prices Set to Drop, But Tax Break Expiry Looms
Translated & summarized from Cursorinfo by baba
Gasoline prices in Israel will drop to 7.35 shekels per liter starting Sunday, but a looming expiration of a temporary tax reduction on November 5 could cause prices to rise by 1 shekel. The Finance Ministry opposes further tax breaks due to budget concerns. The government previously subsidized fuel costs to keep prices down before elections.
The story in 5 lines · by baba
- Gasoline prices in Israel will decrease to 7.35 shekels per liter starting Sunday.
- A temporary fuel tax reduction expires on November 5, potentially raising prices by 1 shekel.
- The Finance Ministry warns that extending tax breaks would strain the budget by 300 million shekels.
- Previous government subsidies had kept prices at 7.77 shekels per liter.
- Record high gasoline prices were previously seen in September 2012.
The price of gasoline in Israel will decrease by 42 agorot starting Sunday, bringing the cost to 7.35 shekels per liter. This reduction comes as the Ministry of Energy announced the new pricing, effective from midnight Saturday. However, a temporary fuel tax reduction, implemented by the government, is set to expire on November 5. If this tax break is not extended, gasoline prices are expected to increase by 1 shekel per liter.
Experts from the Ministry of Finance have voiced opposition to further excise tax cuts on fuel, citing a significant budget strain of approximately 300 million shekels and a lack of identified funding sources. They warned the decision could complicate the execution of the state budget. This comes after the government allocated 300 million shekels to subsidize fuel costs, which had previously lowered the price to 7.77 shekels per liter ahead of elections, preventing an expected rise to 8.27 shekels.
The potential price hike due to the expiring tax relief could impact not only drivers' expenses but also the prices of goods and services. The previous record high for gasoline (AI-95) was in September 2012, when it also cost 8.25 shekels per liter. At that time, Benjamin Netanyahu first proposed reducing the gasoline excise tax.
