Finance Minister Yuval Steinitz has decided to reduce value-added tax by half a percent as of this Friday, Israel Radio reported Wednesday morning.
The new rate will be 16 percent. It was raised to 16.5% from 15.5% in July.
The Treasury said that the tax cut was a result of economic growth, brought about by the two-year national budget which was approved earlier this year. The ministry clarified that the move would decrease state revenue by some NIS 1.8 billion.
Kadima MK and former finance minister Meir Sheetrit slammed the decision, citing the short amount of time since the VAT was raised.
"This proves that [Prime Minister Binyamin] Netanyahu zigzagging in this arena too, without any budgetary policy. Thus, he is hurting the weak and benefiting the strong," Sheetrit charged in a statement released Wednesday.
"It's up to the government to lower the tax, in a drastic manner and by much bigger percentages, in order to help the middle and lower strata," he added.
He also called on the government to "cancel the planned income tax cuts, which will only help the strong and the rich, and widen gaps in society."