Cabinet approves $4.2bn budget for 2014 in Palestine

The cabinet approved Tuesday the budget for 2014 fiscal year and sent it over to President Mahmoud Abbas for final ratification, according to a cabinet statement.It said the budget was set at $4.216 billion with a $1.279 billion deficit.The budget law gives overall expenditures at $663.8 billion, which includes salaries for around 180,000 civil servants estimated at $2.018 billion, up by 4.9% from the previous budget following agreements signed between the government and the employees union.The budget also includes $350 million for development projects, of which $300 million are expected to be financed by the donor countries and the remaining $50 million will be financed by the government.Around $2.742 billion are expected to be obtained as revenues from taxes and other fees, including clearance tax revenues collected by Israel, which is up by 7.6% of the overall revenues and 11.6% of the net general revenues.The cabinet also decided to entitle the prime minister and the minister of finance to set up an emergency budget from operating funds amounting to 20% of the general budget in order to deal with any state of emergency.Minister of Finance Shukri Bishara said Israel’s control over the borders and the crossings will remain the biggest challenge facing economic development, which also affects revenues.He said although large amounts of revenues are being lost every year because of the Israeli “selective, unbalanced” policy in implementing the agreements, 'this should not drive us away of our strategic goal of having a modern, effective management of the state budget by increasing the funding sources through increasing revenues and increasing dependence on the national resources.'