Deficit in the government's activities climbed in May and reached 7.2%

The deficit in the government's activities climbed in May and reached 7.2%, compared to a deficit of 7% in April - according to the budget execution estimate of the Accountant General at the Ministry of Finance.
The annual target of the deficit is 6.6% in relation to GDP. The Ministry of Finance and the Bank of Israel still estimate that this will be the deficit at the end of 2024. Although the deficit has already crossed the target, the estimates of the Bank of Israel and the Treasury are based on the assumption that towards the end of 2024, when the first months of the war of 2023 are excluded from the calculation of the 12-month deficit, the deficit will balance and return to the level the predicted
The deficit in May amounted to NIS 10 billion, after a sharp increase of 35% in expenses compared to the corresponding period in 2023. The increase is mainly in the fighting expenses, but even without the fighting expenses the increase in expenses reached 10.7%, this compared to a planned increase of only 4.9%.
Despite the increase in expenses beyond the forecast, the income line continues to show a relatively strong performance. Revenues increased by 2% in May compared to the same month last year, after a nominal increase of 3.1% in tax revenues. Most of the increase was recorded in indirect taxes.