Budget data for December and for full-year 2015

January 11, 2016

Bottom line: The budget deficit for 2015 — NIS 24.5bn., or 2.15% of GDP — was much lower than forecast. That result reflects many factors, including surging tax receipts for most of 2015, restrained expenses and a few positive one-off developments. However, the declining trend in the deficit / GDP ratio, from a recent peak of 4.3% in February 2013, almost certainly ended in late 2015, at a level of 2.0% in September and November. From here on, the trend will be upward, the questions are by how much and for how long.

  • The deficit for December 2015, at NIS 16.4bn, was some two-thirds of the total for the year. It was swollen by payments authorized by the 2015-2016 budget, belatedly passed in late November.
  • Revenues for 2015, at NIS 301.2bn, were 5.3% higher than in 2014 and 1% above the original projections for 2015.
  • Tax collection rose by 7.1% in 2015, after adjustment for changes in tax rates. Direct taxes were 10.1% higher and indirect tax revenues rose by 3.9%.
  • However, the rapid rate of increase in tax collection — 4% per annum since 2012 and 7% in the period June 2014- August 2015 — has faded. The annualised rate of increase in the last four months of 2015 was zero.
  • Overall spending, at NIS 325.7bn for the year, was 1% below target, although it was 4.9% higher than in 2014.
  • Civilian ministries — i.e. all except Defence — spent only 97% of their allotted budget, although their spending was 5.4% up on 2014.
  • Defence spending was over 105% of its planned budget and up by 3.6% over 2014 — instead of declining by 1.4% as planned.



12-month trailing average monthly deficit (excl. net new credit)

December 2012 – December 2013, in NIS mn.

graph (12.01.16)

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