As Yesh Atid Chairman Yair Lapid gears up to assume the office of finance minister, it remains unclear who will be his choice for the ministry's director-general.
The Finance Ministry director-general's position is a high-profile one but does not carry great authority. According to Israeli law, most of the ministry's decisions and recommendations are in the hands of its various division chiefs.
Since it became clear that Lapid would agree to be finance minister in Prime Minister Benjamin Netanyahu's new government, one of the assessments prevalent in the political arena is that Brig. Gen. (res.) Hillel Kobrinsky Lapid's campaign manager and right-hand man, who was also chosen to head the coalition negotiations on his behalf would be named for the position. No official statement has been made in the matter thus far.
Former Ariel Sharon adviser Uri Shani, who is also considered one of Lapid's close associates, is an unlikely candidate, as it seems he would rather maintain his influence from the outside.
At this time, it is believed that the Finance Ministry's top officials are expected to remain in office, at least until the new state budget is formulated, in mid-July.
The Finance Ministry will implement massive cuts totaling NIS 30 billion ($8.1 billion) to the governments budget over the next two years. The plan seeks to cut NIS 10 billion ($2.7 billion) in 2013 and NIS 20 billion ($5.4 billion) in 2014, as well as raising NIS 4 billion shekels ($1.1 billion) from the public sector through raised taxes and other measures.
One of the major changes will be an initial 1 percent hike in the value added tax, bringing it up to 18%. The VAT exemption on fruits and vegetables will also be canceled. There will be a NIS 3 billion ($813 million) cut in child allowances, and public sector salaries will be cut by NIS 4 billion ($1.1 billion). The retirement age for women will be raised to 67, from the current age of 62.
The Finance Ministry's plan is in its final stages and will likely be presented later in the week to the new finance minister, presumably Yair Lapid.
The plan will cut NIS 2.5 billion ($700 million) from the defense budget in 2013 and double that in the 2014 budget. The cuts will also affect local authorities, including NIS 350 million ($95 million) to NIS 700 million ($190 million) in cuts from municipalities and a 5-8% rise in property taxes beyond inflation.
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