Photo by
Adi Gefen/TPS-IL on 30 October, 2019
Israel’s War Economy: Financial Statements Show Cost of National Defense and Reconstruction
Jerusalem, 30 June, 2025 (TPS-IL) -- Israel’s Accountant General published the state’s consolidated financial statements for 2024 on Sunday, revealing the deep and wide-ranging economic toll of the government’s efforts to maintain financial stability amid 20 months of war.
The war, sparked by Hamas’ October 7 attack, reshaped Israel’s fiscal landscape, according to Accountant General Yali Rothenberg. Defense spending surged, emergency aid was deployed nationwide, and broad reconstruction efforts were launched in both the north and along the Gaza border. The financial statements dedicated extensive chapters to these war-related expenditures, detailing government operations to support evacuees, fund the defense establishment, compensate citizens through the Property Tax Fund, and jumpstart rehabilitation programs under new frameworks such as the Northward Movement and the Gaza Reconstruction Administration.
Finance Minister Bezalel Smotrich underscored the war’s sweeping impact. “The financial statements of the State of Israel reflect a profound and comprehensive picture of the government and its branches,” he said. “As can be seen in the financial statements, the ‘War of Rebirth,’ which includes the campaign against Iran, has significant implications for the economy. We are now focused on winning the just war that will ensure our existence in the country, by allocating the necessary resources to the defense system and supporting the Israeli home front that stands firm.” The “War of Rebirth” is the government’s name for the war.
Smotrich added, “I am convinced that with God’s help, victory will bring security, and security will return an excess return to the economy and bring about a great surge of growth and development, and this will be reflected in the financial statements of the coming years.”
The Accountant General’s annual financial statement provides a comprehensive accounting of the government’s financial activities. The 2024 report consolidated 209 public entities, including ministries, authorities, state-owned companies, and statutory corporations. Total assets stood at NIS 2.116 trillion ($630 billion), with state lands comprising more than half at NIS 1.133 trillion ($340 billion). Liabilities reached NIS 3.624 trillion ($1.07 billion), including NIS 1.108 trillion ($330 billion) owed by the National Insurance Institute, NIS 752 billion ($222 billion) for employee rights, and NIS 1.384 trillion ($410 billion) in public debt.
“The publication of the financial statements just days after the end of [Operation] ‘Rising Lion’ is further evidence that, despite the many challenges, we are committed to maintaining a proper routine for the sake of the Israeli economy,” said Rothenberg. Operation Rising Lion is the military’s name for the strikes on Iran’s nuclear and military facilities. “Through fiscal restraint and investment in growth generators, we will emerge strengthened.”
The report included updated valuations of state lands, improved inter-ministerial data coordination, and a chapter dedicated to Israel’s accelerating infrastructure projects—many now repurposed or expanded to meet wartime needs. The war’s effects also influenced the state’s pension obligations, which fell to NIS 716 billion ($212 billion) from NIS 747 billion ($221 billion) due to rising interest rates.
Israel launched preemptive strikes against Iranian nuclear sites on June 13, citing intelligence that Tehran had reached “a point of no return” in its pursuit of nuclear weapons. According to Israeli defense officials, Iran has developed the capacity to rapidly enrich uranium and assemble nuclear bombs, with sufficient fissile material for up to 15 weapons.
Israeli intelligence also exposed a covert program to complete all components of a nuclear device. The strikes marked a dramatic escalation in what officials describe as a broader Iranian strategy combining nuclear development, missile proliferation, and proxy warfare aimed at Israel’s destruction.
A U.S.-brokered ceasefire went into effect on Tuesday. During 12 days of fighting, Iranian missile strikes killed 28 Israelis and injured over 3,000.
At least 1,180 people were killed, and 252 Israelis and foreigners were taken hostage in Hamas’s attacks on Israeli communities near the Gaza border on October 7. Of the 50 remaining hostages, around 30 are believed to be dead.
