How Large Is Israel’s Budget Deficit? 4.7% of GDP in 2025
Israel’s central government budget deficit was 4.7% of GDP in 2025, on the Bank of Israel’s count, after 6.7% in 2024 and against a 4.9% target.
Israel’s central government budget deficit was 4.7% of GDP in 2025, on the Bank of Israel’s Annual Report 2025, against an original 2025 target of 4.9%. The figure uses the budget definition and follows a deficit of 6.7% in 2024. The Bank of Israel puts the wider general government deficit at 6.5% of GDP in 2025. In its second estimate of 10 March 2026, the Central Bureau of Statistics recorded a general government deficit of NIS 110.3 billion, or 5.2% of GDP.
| Figure | What it counts | Who published it | Period |
|---|---|---|---|
| 4.7% of GDP | Central government budget deficit, budget definition | Bank of Israel | 2025 |
| 4.9% of GDP | Original central government deficit target | Bank of Israel | 2025 |
| 6.7% of GDP | Central government budget deficit, budget definition | Bank of Israel | 2024 |
| 6.5% of GDP | General government deficit, national-accounts definition | Bank of Israel | 2025 |
| NIS 110.3 billion, 5.2% of GDP | General government total deficit, national-accounts definition, second estimate | Central Bureau of Statistics | 2025 |
| NIS 2,108 billion | Total GDP, second estimate | Central Bureau of Statistics | 2025 |
| 68.5% of GDP | Gross public debt, up from 67.6% in 2024 | Bank of Israel | 2025 |
The central government deficit was 4.7% of GDP in 2025
The Bank of Israel puts the central government budget deficit at 4.7% of GDP in 2025, in Chapter 6 of its Annual Report 2025. In Table 6.1 the Bank shows the deficit as revenue less expenditure, with every item expressed as a share of GDP. Expenditure in the table is net. The Bank defines net expenditure as excluding “expenditures that are conditional on revenues, such as defense assistance from the US.”
| Item, 2025 | Share of GDP |
|---|---|
| Revenue | 26.2% |
| Expenditure, net | 30.9% |
| Budget deficit | 4.7% |
| Initial deficit, before interest | 2.4% |
| Interest | 2.3% |
Source: Bank of Israel, Annual Report 2025, Table 6.1. Central government, budget definition.
The table can be read two ways. Revenue less expenditure gives the 4.7%. The initial deficit plus interest gives the same 4.7%.
The deficit fell from 6.7% in 2024, under the 4.9% target
The Bank of Israel records the central government budget deficit at 4.1% of GDP in 2023, 6.7% in 2024 and 4.7% in 2025. The Bank prints an original 2025 target of 4.9% of GDP beside the 2025 outturn. All three years use the budget definition.
Table 6.1 shows the 2024 deficit as revenue of 24.2% of GDP against expenditure of 30.9%. The 2025 expenditure figure is the same 30.9%.
The Bureau puts the general government deficit at NIS 110.3 billion
The Central Bureau of Statistics recorded a general government total deficit of NIS 110.3 billion in 2025, or 5.2% of GDP, after NIS 161.8 billion, or 8.1% of GDP, in 2024. These figures use the national-accounts definition. They come from the Bureau’s second estimate of 2025, media release 073/2026, published on 10 March 2026. The Bank of Israel publishes its own general government figure on the same definition, and the two figures differ as published.
| Who published it | Measure | 2024 | 2025 |
|---|---|---|---|
| Central Bureau of Statistics | General government total deficit, national accounts, second estimate | NIS 161.8 billion, 8.1% of GDP | NIS 110.3 billion, 5.2% of GDP |
| Bank of Israel | General government deficit, national accounts | 9.0% of GDP | 6.5% of GDP |
| Bank of Israel | Central government budget deficit, budget definition | 6.7% of GDP | 4.7% of GDP |
Each row is reported with the body that published it, and the rows do not form one series. The Bureau’s release states that its next estimate was due on 16 April 2026, so its 2025 figures are subject to revision.
The war cost about NIS 350 billion over 2023 to 2026
The Bank of Israel puts the fiscal cost of the war that began on 7 October 2023 at about NIS 350 billion over 2023 to 2026. Its Table 6.2 prints NIS 352 billion. The 2026 column is a forecast. The total excludes the Iran campaign that began in late February 2026 and the damage from it.
| Figure | What it counts | Period |
|---|---|---|
| About NIS 350 billion (NIS 352 billion in Table 6.2) | Fiscal cost of the war, including a 2026 forecast | 2023 to 2026 |
| NIS 249 billion | Gross defence expenditure above the pre-war multiyear agreement, not total defence spending | 2023 to 2026 |
| NIS 116 billion | Cost of the war in 2025 | 2025 |
| NIS 84 billion | Defence part of the 2025 cost | 2025 |
| NIS 25 billion | Financed by a special United States grant: NIS 13 billion in 2024 and NIS 6 billion in each of 2025 and 2026 | 2024 to 2026 |
Source: Bank of Israel, Annual Report 2025, Table 6.2.
The Bank of Israel reports central government defence expenditure of 7.8% of GDP in 2025, on the budget definition and net of spending conditional on revenues.
No full-year 2026 deficit figure appears in these releases
The Bank of Israel published its Annual Report 2025 with deficit and debt figures that run to 2025. The Central Bureau of Statistics published its second estimate for calendar 2025. Neither release carries a 2026 outturn, a 2026 deficit target or a rolling 12-month deficit.
- Bank of Israel, Annual Report 2025, Chapter 6. Deficit, debt and defence figures run to 2025. The only 2026 figures are in Table 6.2: the forecast cost of the war and the NIS 6 billion United States grant tranche.
- Central Bureau of Statistics, media release 073/2026. GDP and the general government balance for 2025, compared with 2024.
Which deficit figures may not be set side by side?
The 4.7%, the 6.5% and the 5.2% may not be set side by side as one measure. The Bank of Israel states that its central government figures on the budget definition differ from its general government figures on the national-accounts definition. The Central Bureau of Statistics published its 5.2% as a second estimate, subject to revision. The Bank’s central government expenditure excludes spending conditional on revenues, such as US defence assistance. The NIS 249 billion counts only defence spending above the pre-war agreement. The NIS 350 billion includes a 2026 forecast and excludes the Iran campaign.
Questions readers ask
How big is Israel’s economy?
The Central Bureau of Statistics recorded total GDP of NIS 2,108 billion in 2025, in its second estimate of 10 March 2026. Real growth in 2025 was 2.9%, after 1.0% in 2024.
How fast did Israel’s economy grow in 2025?
The Central Bureau of Statistics recorded real GDP growth of 2.9% in 2025, revised from 3.1% in its first estimate. Real GDP per person rose 1.6%, while the population grew 1.4%.
What is GDP per person in Israel?
The Central Bureau of Statistics put GDP per person at NIS 208.6 thousand in 2025, at current prices. The release gives the figure in shekels only.
How much public debt does Israel have?
The Bank of Israel reports gross public debt of 68.5% of GDP in 2025, up from 67.6% in 2024.
How much did prices rise across Israel’s economy in 2025?
The Central Bureau of Statistics recorded a 2.1% rise in the prices of domestic product, known as the GDP deflator, in 2025.
How much was Israel’s defence budget raised in 2025?
The Bank of Israel shows a net defence budget of NIS 129.7 billion in the original 2025 budget and NIS 161.8 billion after revision, in Figure 6.2 of its Annual Report 2025. For 2024, the same figure shows NIS 78.5 billion originally and NIS 163.8 billion after the December revision.
What does defence cost on the national-accounts measure?
The Bank of Israel records domestic defence consumption of 6.5% of GDP and defence imports of 0.7% of GDP in 2025, on the general government national-accounts definition. The 2024 figures were 6.8% and 0.8%. These figures use a different definition from the 7.8% budget figure.
Does the deficit include defence spending funded by US aid?
The Bank of Israel states that its central government expenditure excludes “expenditures that are conditional on revenues, such as defense assistance from the US.” Defence spending financed by US military assistance therefore falls outside these figures.
Does the war cost include the 2026 Iran campaign?
The Bank of Israel states that its estimate of about NIS 350 billion excludes Operation Roaring Lion, the campaign that began in late February 2026, and the damage from it.
Will the 2025 figures change?
The Central Bureau of Statistics published its 2025 figures as a second estimate, which replaced the first estimate of 16 February 2026. The release stated that the next estimate would follow on 16 April 2026.
How does Israel’s growth per person compare with the OECD?
The Central Bureau of Statistics recorded real growth in GDP per person of 1.6% in 2025. Its release quotes an OECD forecast of 1.3% average growth across OECD countries for the same year. The OECD figure is a forecast, not an outturn.
Who publishes Israel’s deficit figures?
The Bank of Israel publishes the central government budget deficit and a general government deficit in Chapter 6 of its annual report. The Central Bureau of Statistics publishes the general government balance in its national accounts releases.
Sources
- Bank of Israel, 2026. Annual Report 2025, Chapter 6: The Public Sector and its Financing. English edition. https://boi.org.il/media/u4zp5dm5/chap-6e-2025.pdf. Official or primary record.
- Central Bureau of Statistics, 2026. Israel’s National Accounts 2025: Second Estimate. Media release 073/2026, 10 March 2026, Hebrew. https://www.cbs.gov.il/he/mediarelease/DocLib/2026/073/08_26_073b.pdf. Official or primary record.
