Israel’s 2026 budget clears first Knesset vote amid political uncertainty

Thursday 29 January 2026 - 09:30

By: Sahili Aya

Israel’s 2026 budget clears first Knesset vote amid political uncertainty

Israel’s parliament has approved the first reading of the 2026 state budget, easing immediate political pressure on Prime Minister Benjamin Netanyahu’s coalition but leaving the government facing crucial hurdles in the weeks ahead.

The budget passed its initial vote with a narrow majority after last-minute negotiations resolved tensions with ultra-Orthodox coalition partners. Lawmakers had delayed the vote amid disagreements over proposed exemptions from military service for yeshiva students, a long-standing and sensitive issue in Israeli politics.

While some ultra-Orthodox parties supported a temporary legislative compromise, others opposed the bill, exposing divisions within the coalition. Despite the breakthrough, the government must still secure two additional parliamentary approvals before March 31. Failure to do so would automatically dissolve the Knesset and trigger early elections.

Netanyahu, who has warned that a snap vote would be destabilizing, is seeking to maintain unity within his bloc as the required 60-day period between the first and final budget votes begins. The coming debates are expected to be closely contested, with opposition parties aiming to capitalize on coalition fragility.

The passage of the budget will be a key test of the government’s ability to govern amid ongoing domestic tensions and intense political scrutiny.