Rationing of Consumer Goods May Be Resumed in Israel, Minister Warns

Rationing of consumer commodities, suspended in the last month, may have to be resumed, Pinhas Sapir, Minister of Trade and Industry, warned here today. He issued a statement calling on Israelis not to throw away their old ration books because “you might be needing them again.”

The government is giving intensive study to the problem of increased prices that have followed the increase in various taxes and customs duties, and the abolition of subsidies for some basic foodstuffs. There is a possibility that special sugar allowances for children may be reinstated. The government re-studies of the price structure have become necessary as a result of higher price increases on commodities than expected as a result of the recent economic changes.

Some of the taxes imposed only within the last week on certain commodities like sugar and coffee may be relaxed, and some of the new income taxes imposed on Israelis may be lightened , especially those that affect wage-earners in the lower-income bracket. These changes in fiscal policy were indicated last night in Tel Aviv at a public meeting by Finance Minister Levi Eshkol.

Protests against “suffocating taxes” were voiced at the meeting, and Mr. Eshkol conceded that some “relaxation” might be necessary. The commodity market here is unstable, and prices continue climbing. An emergency meeting was scheduled for today between a group of Israeli industrialists and Mr. Sapir. Wage policies as well as the scheduling of prices for commodities depend on the outcome of various demands for easing the new taxes.

The government today appointed a parliamentary committee to recommend retrenchments in government expenditures. The move follows demands for such cuts due to the heavy expenses being incurred as a result of the new wave of mass immigration into Israel. Members of the opposition, in the coalition government, are advocating a slash of five percent in government expenditures, and a freeze of new appointments on the Civil Service lists. It has also been proposed that all government jobs becoming vacant–whether by retirement, resignation or dismissal–be left unfilled.