{"id":315468,"date":"2025-12-14T11:21:08","date_gmt":"2025-12-14T11:21:08","guid":{"rendered":"https:\/\/www.newsbeep.com\/uk\/315468\/"},"modified":"2025-12-14T11:21:08","modified_gmt":"2025-12-14T11:21:08","slug":"israelis-face-painful-price-hikes-in-2026","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/uk\/315468\/","title":{"rendered":"Israelis face painful price hikes in 2026"},"content":{"rendered":"

Despite government promises that living costs would ease after the war<\/a>, a new round of price increases and cuts to benefits is poised to hit Israeli households on January 1, according to senior economists. For the average family, the announced increases and the elimination of past benefits are expected to cost between 800 shekels (about $250) and 1,200 (about $375) shekels per month \u2014 equivalent to 9,600 shekels ($3,000) – 14,400 shekels ($4,500) annually, depending on family size and wage effects.<\/p>\n

While the Finance Ministry has promoted a tax\u2011bracket relief for monthly earners between 16,000 shekels and 25,000 shekels, experts say this benefit is dwarfed by the ongoing freezes of income tax brackets, child benefits and tax credits \u2014 moves that effectively reduce real income. The freezes, originally promised to end in 2026 to aid middle\u2011class families and large households, instead continue, deepening the financial strain, analysts say.<\/p>\n

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1 View gallery <\/p>\n

\"\u05e7\u05e0\u05d9\u05d5\u05ea<\/a>\"\u05e7\u05e0\u05d9\u05d5\u05ea<\/p>\n

Higher costs for middle income families<\/p>\n

(Photo: Dana Koppel)<\/p>\n

Starting January 1, a series of price increases on basic services and products \u2014 already approved by state and local authorities \u2014 will take effect, disproportionately affecting lower\u2011income families and those with many dependents.<\/p>\n

Main Cost Increases Taking Effect January 1<\/p>\n

\u2022 Water: The Water Authority has published for public comment a 2.49% price rise for water.<\/a> For an average four\u2011person household using 16\u202fm\u00b3 per month, this translates to an extra about 3 shekels per month, with larger families typically seeing increases of more than 5 shekels.<\/p>\n

\u2022 Cooking Gas: Expected to rise by about 5% due to higher cylinder costs and indexation, with knock\u2011on price effects in restaurants.<\/p>\n

\u2022 Arnona (Municipal Property Tax): While the automatic yearly increase is limited to 1.6% \u2014 down from a 17\u2011year high of 5.27% in 2025 \u2014 about 90 local authorities are seeking exceptional hikes, mainly for businesses but also for households. Examples include:<\/p>\n

Ramat Gan 6.5\u20138.5%, Ramle 4%, Ashkelon industry 7.5%, Basmat Tivon 12%, Beit Aryeh 17%, Gilboa Regional Council 6% (commercial\/services\/industry), and Yeruham 4% (offices\/services\/commerce\/industry\/crafts). These increases can mean tens to sometimes hundreds of additional shekels per month in many municipalities.<\/p>\n

\u2022 Income Tax Bracket Freeze, Tax Credits & Child Benefits: This is considered the toughest blow. Tax brackets are supposed to adjust yearly with inflation. The 2025 budget froze this adjustment, effectively cutting workers\u2019 real wages by about 3%. Continued freezing in 2026 is expected to further erode net wages by 2.0\u20132.5%, costing dual\u2011earner households hundreds of shekels per month. Child allowances remain frozen as well: 169 shekels for the first child and 214 shekels for each subsequent child. The \u201cKnesset Savings for Every Child\u201d contribution is frozen again, costing roughly 3 shekels per child per month over two years.<\/p>\n

\u2022 National Insurance (Bituach Leumi): Increased premium rates for low\u2011wage earners (up to 7,522 shekels) will continue, adding 48 shekels per month for employees and 72 shekels for employers.<\/p>\n

\u2022 Cigarettes: Prices of electronic cigarettes will rise. A 1 shekel per ml tax will apply to e\u2011liquid and 30 shekels per vaping device.<\/p>\n

\u2022 Property Taxes: A 1.5% tax on non\u2011agricultural vacant land will be introduced, likely pushing up housing prices. A new 2% tax will apply to real estate investors selling non\u2011residential properties.<\/p>\n

\u2022 Public Sector Wages: Wages in the public sector will be cut again in 2026 \u2014 this time by 1.2%, following a 2.29% cut this year, affecting hundreds of thousands of workers.<\/p>\n","protected":false},"excerpt":{"rendered":"Despite government promises that living costs would ease after the war, a new round of price increases and…\n","protected":false},"author":2,"featured_media":315469,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[84,1294,56,54,55],"class_list":{"0":"post-315468","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-economy","8":"tag-business","9":"tag-economy","10":"tag-uk","11":"tag-united-kingdom","12":"tag-unitedkingdom"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/315468","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/comments?post=315468"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/315468\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media\/315469"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media?parent=315468"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/categories?post=315468"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/tags?post=315468"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}