Benjamin Netanyahu
Benjamin Netanyahu Shalev Shalom/TPS

Former Prime Minister Benjamin Netanyahu, who leads the Likud party, on Wednesday morning revealed his economic plan for the next government, promising to lower taxes and drastically reduce the cost of living.

The plan was formulated over the past several weeks, together with former Economy Council chief Professor Avi Simhon, former Finance Ministry Director General Shai Babad, and former Finance Minister Yuval Steinitz (Likud).

"Only a stable nationalist government will lower the prices which have been rising uncontrollably over the past year," Netanyahu said. "In our government, the rise in prices was half a percent each year. On the other hand, in the past year alone, costs have risen by nine times - 4.5%. Electricity went up, food went up, gas became more expensive, water became more expensive."

"In the past year, every family in Israel has paid at least 7,900 additional shekels each year - a huge burden on the families. The rise in prices will bring with it another rise in prices. We are standing before a risk of dizzying inflation. There is a global economic crisis, no one is denying that, but that is not an excuse for inaction. A global economic crisis requires a leadership which will extract Israel from this crisis, first in the world. This does not have to be our destiny.

"Israel can escape this, and we have already done this. We extracted Israel from three global economic crises: In 2003, in 2009, and in 2020 during the coronavirus crisis. We will extract Israel from the crisis. There are three conditions for success: A stable government, personal leadership by the prime minister - I take upon myself this task as I did in the three previous economic crises. The third thing: I am bringing a temporary and bold emergency plan in order to lower prices."

Netanyahu then detailed his plan: "There are two basic ingredients in our plan: Ending the rise in prices, and reducing taxes. Ending the rise in prices includes reducing prices immediately on what is causing the inflation: We will reduce the cost of electricity, the cost of gas, the cost of water, and we will freeze the property tax rates for a year. These are the steps which will influence all of the prices in the economy. We will lower the cost of food by lowering taxes and customs taxes."

He also detailed a plan for reducing the cost of housing, promising enforcement for those who break the law. Netanyahu added, "We will continue to subsidize land for construction for young couples, and we will subsidize supportive infrastructure prior to construction."

"We will use a 'carrot and stick' method with the contractors. If they hold onto land and do not build - they will get a stick. If they build quickly - they will get a carrot."

"We will lower income tax by spreading out the tax brackets and increasing the number of tax credit points, along with increasing negative income tax. We will also reduce the companies' tax in order to encourage growth and income," Netanyahu said.

"The sources of funding for the plan will make use of some of the excess taxes in Israel - nearly 60 billion shekels - alongside more improved and efficient use of the State budget. We will make the public system more efficient, and that will bring us sources of funding for the plan."