A considerable reduction in income tax, including the exemption from taxation of up to 70 percent of the cost of living allowances granted white collar and industrial workers, in Israel, was promised today by Finance Minister Levi Eshkol when he formally presented the new 216,000,000 pound budget to Parliament and reviewed the economic progress of the country.
Discussing the year-old anti-inflationary measures of the government, Mr. Eshkol said that despite some increases in prices with attendant difficulties, the inflationary spiral had been halted. He pointed out that except for foreign currency controls virtually all other economic controls had been abolished. He held out no hopes for an early end to currency controls, insisting that the government must accumulate a minimum foreign exchange reserve before it can take such action.
He estimated the country’s national income last year at 800,000, 000 pounds, but pointed out that the foreign trade deficit alone amounted to 127,000,000 pounds. However, he stated, Israel’s foreign currency commitments had not increased last year and a number of short term obligations had been turned into medium and longterm loans, thus relieving some of the pressure.
New investments of all sorts–including capital from abroad–had totalled 250,000,000 pounds last year, Minister Eshkol revealed. But, he indicated that this figure was still far short of what Israel needed.
The only solution for Israel’s trade deficit, he asserted, was to increase the production of both agricultural and industrial goods for export. He reported that both branches of the economy had advanced during the past fiscal year and that in certain foods, such as potatoes, Israel was now self-sufficient. In such export crops as citrus fruits, bananas and grapes there had also been increased production.
The citrus growers association today revealed that citrus exports thus far in the season had already surpassed last year’s shipments. A total of 3,373,000 cases have been shipped and there is hope of reaching the 4,000,000 mark, it was revealed.
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