Impact of Political Paralysis on the Israeli Economy

In depth

According to Calcalist, the inconclusive election is expected to freeze government activity for at least two months and delay reforms and economic legislation. The Treasury is preparing for the start of 2027 without an approved budget, with a freeze on contracts. According to Calcalist, the paralysis could cost the economy up to NIS 12 billion.

According to Israel Hayom, the political paralysis paves the way for a continuation budget starting next March, a move that would choke the economy's growth and delay tax reforms worth billions. According to Globes, the surge in military demands, the depleted coffers from the property tax, and the required tax reforms will be at the center of the agenda.