Israel Approves Record Defense Budget Amid Ongoing Iran War

Israel’s Knesset has authorized a historic $45.8 billion defense budget. This approval comes as the conflict with Iran enters its second month.

The Israeli military has shown its capability during various crises, but the situation escalated further with the outbreak of the Gaza war, responding to Hezbollah’s attacks in Lebanon, the regional instability after the fall of Bashar al-Assad in Syria, and now the Iran war.

Over the past month, under Operations Epic Fury and Roaring Lion, Israeli airstrikes have targeted key figures within Iran’s regime, including Supreme Leader Ayatollah Khamenei, who has been implicated in orchestrating terrorist attacks against Israeli civilians.

Ofir Katz from the Coalition Party commented on the budget, stating, “This is good news for Israel and its people, benefiting defense, welfare, education, health, reservists, and those living near borders. We’re stable, we’re strong, and we’ll persist in serving the people of Israel throughout our coalition’s term.”

The total budget for fiscal year 2026 was set at around $271 billion. Opposition members have voiced concerns over the significant defense allocation and the extensive spending on projects aligned with Prime Minister Benjamin Netanyahu’s interests.

Opposition leader Yair Lapid expressed his frustration on social media, denouncing the budget as serving “only the corrupt” and pledging to overturn any perceived favors to special interests in a future government.

He stated, “Anyone who gains a job through connections is out. Anyone getting a budget for being close to certain areas—well, we’ll actively cut them off.” It was a pointed dig at the Haredim, Israel’s ultra-Orthodox community, often criticized for their exemption from military service.

Earlier in October, Lapid suggested that the Haredim should lose their voting rights unless they joined the army. To secure passage of the budget, Netanyahu had to abandon a contentious bill that would have granted the Haredim a permanent exemption from military service. Despite the withdrawal, ultra-Orthodox parties chose to remain loyal to Netanyahu.

The opposition reacted strongly against the funding allocated to ultra-Orthodox institutions in the budget, which Lapid labeled “the biggest theft in the state’s history.”

A significant source of discontent was the provision of approximately $255 million for ultra-Orthodox programs, surprise funding that emerged late during extended budget discussions marked by opposition filibusters and frequent air raid alerts due to Iranian missile threats.

Some opposition members claimed they accidentally voted for the funding, resulting in criticism from the ruling coalition about their apparent lack of diligence in reading the bill.

Netanyahu was determined to pass the budget, not only for military support against Iran and Lebanon but also to avoid the collapse of his government, which could trigger early elections if the budget failed to pass by March 31. There’s a looming election in October, though Netanyahu hinted it could take place as early as September.

Finance Minister Bezalel Smotrich commended the budget, which passed with a 62-55 vote, calling it inclusive and a response to rising living costs.

Smotrich emphasized, “This budget will be enacted under a right-wing government that will fully serve its term and address security, economic, and judicial reforms.” He warned that voting against the budget equated to being against Israel’s security and financial relief for workers.

He concluded that the increased military funding would “greatly enhance our geopolitical and diplomatic standing” and aim to “reshape the Middle East.”