Israel Cabinet Fails to Approve $42,200,000 Compulsory Savings Loan
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Israel Cabinet Fails to Approve $42,200,000 Compulsory Savings Loan

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The outgoing Cabinet failed to act today on the request by the Treasury for approval of a 75, 000, 000-pound ($42,200,000) compulsory savings loan to finance absorption costs for Israel’s increased flow of immigration.

At a special Cabinet meeting called today to consider the loan recommended Sunday by the Ministerial Economic Committee, Finance Minister Levi Eshkol, who presided over the Cabinet during Premier David Ben-Gurion’s vacation, failed to convince non-Mapai Ministers that the compulsory loan was the only available source of the needed funds. Further consideration of the issue was deferred until the next Cabinet meeting on Sept. 17.

Opposition to the loan, which would amount to 12 to 15 percent of Israelis’ income tax payments, was based on the view that changes in the current budget, which totals nearly 2,000,000,000 pounds ($1,120,000,000), could provide even larger sums than those required to house new immigrants.

This attitude was reflected in an editorial in today’s Ha’aretz, an independent morning newspaper, which stated that while there was validity in the argument that Diaspora Jewry, committed to increase aid to Israel, may expect Israelis to make a greater contribution toward absorbing newcomers, this need not take the form of new taxation. Other papers today also cited non-essential expenditures which could be diverted for worthier purposes, thus eliminating the need for the compulsory loan.

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