Finance Minister Yuval Steinitz, fresh from a record-setting sale of Israeli bonds to investors in Florida, said on Monday that balancing the government budget will require "moderate but still significant" cuts to the defense sector.

Steinitz, a leading member of the weakened Likud party of Prime Minister Binyamin Netanyahu, also said there are no plans to further raise taxes in order to hit a deficit target of 3 percent of economic output.

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