Finance Minister Orders Fuel Price Cut Amid Election Concerns

Finance Minister Bezalel Smotrich has ordered a reduction in the fuel excise tax to prevent an upcoming price hike that would bring gasoline to an all-time high. The price was set to increase by 16 agorot to 8.25 shekels per liter at midnight on Monday, driven by the global energy crisis and tensions with Iran. However, legal officials argue that such a public benefit cannot be granted within 90 days of an election. This directive follows a similar instance where former Finance Minister Avigdor Lieberman's proposed discount during a previous election campaign was halted by the Justice Ministry's legal counsel.

Economic sources criticized the timing of Smotrich's move, suggesting he should have prepared for the significant price increase earlier. Professional staff within the Finance Ministry also reportedly opposed the decision, citing a lack of budget for the subsidy. Smotrich's office stated that professional discussions are underway to determine the exact reduction and mechanism, with the minister intending to sign the order soon for implementation in the coming days.

The anticipated price increase, which would have marked a record high not seen since September 2012, was influenced by a roughly 6% rise in international gasoline prices, partially offset by a 3% drop in the dollar's value, leading to an estimated 10 agorot per liter increase.