The budget deficit is expected to reach 3.4 percent of GDP in 2012, due to an expected tax revenue shortfall of around NIS 11 billion, Finance Minister Yuval Steinitz said Wednesday.
Steinitz, who spoke before the Knesset Finance Committee, said the deficit of 2 percent set in the government's two-year budget would not be met, with tax revenues set to reach NIS 221 billion, as opposed to the original forecast of NIS 232.3 billion.
The Treasury has also downgraded Israel’s 2012 economic growth forecast to 3.2% from 4%, because of fears of a global economic slowdown and reduced demand for Israeli exports, Steinitz said.
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