Israelis 'welcome' price hikes across the board as they ring in 2023

From gasoline to groceries, the cost of living in Israel increases today

Israelis are ringing in the New Year with a hike in prices at the gas pump, utilities, property taxes and groceries.

Many basic utilities – some of which already rose significantly in 2022 – are going up again.

Essentially, experts predict, the increases being rolled out today have the potential to affect the whole economy.

Already on Jan. 1 the cost of gas went up, marking the third consecutive month that fuel prices rose.

While prices at the supermarket and at the pump are being felt immediately, the property tax hike and the increase in other bills will be seen only in a month or two when periodic electric, gas and water bills come in. The annual property tax is issued in January.

Israelis are also experiencing the same global impact that the war in Ukraine has taken on food and energy. Several Israeli companies already announced they will raise the prices on dozens of products, including pasta, cereal and dairy products.

These price hikes in utilities are expected to be passed on to the consumer.

The price of water will increase by about 3.5% this month – which will be felt by farmers and their individual household bills, but also by consumers who purchase produce.

Electricity prices will rise by 8.2% – the third hike in the last year, amounting to a 20% total increase. Its ripple effect will likely affect prices passed on to customers at private day cares, restaurants, hotels and other venues.

Israel’s Finance Minister Bezalel Smotrich – installed as minister just last week – has said he has a plan to deal with the rising cost of living, which will reportedly include lowering taxes and freezing electricity prices for a few months.

But the plan is still in discussion at the Finance Ministry and could take time to get approved and be implemented. Tentatively, he is considering food stamps or tax credits for low-income and minimum-wage citizens.

Nicole Jansezian