Israel’s Cabinet held two sessions here today, devoting much of its time to a discussion of the Government’s economic policy and widespread demands that proposed tax increases be reduced. There were possibilities that another, special session of the Cabinet may be held tomorrow and that consideration was being given by the Government to cut some of the projected tax hikes.
It was announced that Prime Minister Levi Eshkol will deliver tomorrow the first of a series of three radio broadcasts in which he will explain the Government’s economic policy and the need for changes in the tax structure.
Meanwhile, more professionals today announced their readiness to accept voluntary salary cuts, if the Government would meet them “half way” in regard to taxes. Among these professionals are university faculty members, journalists, senior technicians and executives. The demands have taken on the nature of a popular movement, with many proposing that Gen. Yigael Yadin, the archeologist and former chief of staff of Israel’s armed forces, head a national committee for pressing the view of those who would voluntarily accept pay cuts tied to easement of the Government’s plans to raise taxes.
LOOKS WITH FAVOR ON ‘HALF-WAY’ PROPOSALS BY VARIOUS GROUPS
At the afternoon session of the Cabinet, the Government expressed satisfaction with the various moves made by Israelis willing to forego part of back pay due them, and otherwise to help fight inflation. The Cabinet expressed itself as attaching “great importance” to such offers, following discussion, asked Mr. Eshkol and Finance Minister Sapir to draw up proposals to meet various groups “half-way” and to take measures to check the trend toward higher prices and toward inflation.
At the same time, however, criticism was leveled at the Cabinet meeting by Mr. Sapir against some of the members of the coalition who dissociated themselves from the Government’s budget proposals. He said he could not understand how the parties that voted for the budget could issue public statements at variance with the Government’s economic policy. In this context, he referred to statements made this weekend by coalition partners, mainly those representing the Mapam Party, who announced they would prefer steeper income tax increases to indirect taxation.
A move to accept salary cuts without conditions was made here today by the leaders of the Jerusalem municipality. Mayor Teddy Kollek and his four deputies announced that they will renounce 10 percent of their salaries to help the anti-inflation movement. They stressed that their renunciations are unconditional, unconnected with the proposed tax increases. Mayor Kollek is to give up 160 Israeli pounds (over $53) per month while his deputies will renounce monthly 130 pounds (about $43) each. The savings are to revert to the city’s treasury.
A further illustration of Israel’s awareness of the need for austerity was seen here in an announcement by the municipality of Tel Aviv. Mayor Mordechai Namir, of Tel Aviv, announced this weekend that Purim and Independence Day celebrations this year will be less lavish than they have been in past seasons. As part of the program to effect economies, he said, the traditional Adloyada, the Purim carnival, has been cancelled for this year. Purim will be celebrated March 6.
In an address yesterday to Israeli settlers in the Jordan Valley, Mr. Eshkol pleaded that the kibbutz movement refrain from increasing prices on farm products or “at least keep the increases to a minimum. “
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