The Ministry of Finance Accountant General announced last week that the Government's budget deficit totaled NIS 20.4 billion in 2004, 3.9% of GDP.
The Accountant General noted that the 3.9% deficit was favorably compared with the planned deficit of 4% of GDP. The government's domestic deficit was NIS 17.4 billion, or 3.3% of GDP, and its external deficit was NIS 2.9 billion, or 0.6% of GDP.
Government figures indicate that Israel's GDP in 2004 was NIS 525.4 billions. The budget deficit was far below the Government's target. The Ministry of Finance Accountant General noted that the relatively low deficit was registered despite a NIS 1.9 billion allocation to the development of the railway system and NIS 5.3 billion in tax cuts. Both items amounted to 1% of GDP beyond what was originally planned.
The above two changes amounted, according to Accountant General, to 1.4% of the GDP, which means that excluding these factors, the government's deficit for 2004 was only 2.5% of GDP.
