Also: HH Introduces New Budget of 5201
The first 2 years of the new government under PM Tzafrir are marked by intensive economic reforms.
HH's agenda is essentially summarised in the following 2 points:
1. Remediate government deficit by cutting down spending and increasing taxation.
2. Privatise industries and welcome international trade and investments.
However, opposition calls this strategy as it sees it: "austerity measures".
Corporate taxes are now sitting at 20%, generating 40B BEI per year, with the sales tax for basic and luxury goods at 24% (from 9%), bringing home almost half a trillion BEI into the government's coffers. As a result of decreased government spending and increased taxation, the market witnesses a state of austerity stagnancy, with consumption dropping below 50% after almost a century.
"Consumption is still high, indicative of a culture now so rooted in frivolous spending it's hard to bring the truth to the forefront", was the comment of officials from the Ministry of Finance. "It's important we keep course correcting, thus opening Beiteynu to the realities of international commerce."
On Friday, HH introduced the new government budget, which sees Trade & Industry drop below 1T BEI, after almost a century of frivolous corruption and waste of government funds, which were mostly aimed at supporting executives and redundant infrastructure.
As Ministries undergo spending cuts in both operations and personnel, unemployment is seeing a small, but steady increase.
Meanwhile HH faces an even bigger drop in approval numbers, thanks to the effect of the austerity measures taking a toll from across the spectrum, especially rural areas. This weekend also saw officials from the opposition disapproving FA Ministry's attempts at diplomacy with Dankuk, which ratified the Beiteynu Accord of Diplomacy and is now facing economic sanctions by the World Congress.
"Private industries will boost our economy and inject much needed cashflow into the market. We just need to let them do it.", was Mr. Tzafrir's statement when addressing the Knesset earlier this morning, as part of promoting the new Economic Act of 5201, which takes privatisation efforts to the next level.
"We're ready to welcome trade and private businesses with open arms".
The weekend was marked by a couple of marches in various urban centers, protesting these austerity measures.
