Bank of Israel Governor Stanley Fischer praised the governments plan to raise the value added tax (VAT) after meeting with Prime Minister Binyamin Netanyahu and Finance Minister Yuval Steinitz on Thursday.
"Last month, I was somewhat critical about the government's fiscal policy, but what I've seen in the past two days is very serious progress, and very responsible conduct by economic decision-makers. I hope that within no more than a few days, we'll see a package that will really change the Israeli economic situation, and allow us to continue to grow at a very respectable rate," Fischer stated.
Fischer said that the latest measures, including raising VAT, were not the end of the process, and more tax hikes were likely.
Netanyahu said following the meeting, "Even after the steps taken, families in Israel, the middle class and the poor will be left with more money in their pockets. I remind you that, in a few days, we will bring free education from the age of 3. Hundreds of families will save NIS 800 a month. We brought credit points for working families worth hundreds of shekels more a month, which came into effect in January 2012. We've already greatly reduced the monthly mobile bill, and we've brought free dental care for children up to 12. This is a huge difference, which will ultimately leave Israel's people with more money in their pockets."