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Underlying the Finance Ministry's draft of a budget for 2009 and 2010 is a grim assumption about tax collection in that period. The working assumption is that tax collection will fall NIS 80 billion short of the original target for the two years together.

The ministry is assuming that tax collection will only pick up in 2011, as the world exits the economic crisis still wracking the global economy outside the bubble of the stock markets, which have been rallying this year. So far.

The treasury team, including brand-new minister Yuval Steinitz, worked throughout Passover: They need to present a draft budget for the two years by the end of May.

During the first two weeks of May, the cabinet is scheduled to discuss the budget targets and figures, and hopefully to approve them, together with the Economic Arrangements Law, a hodgepodge of acts with some vague connection to economics. The budget draft approved by the cabinet is scheduled to be presented to the Knesset no later than June 16.

The Knesset then has until July 15 to approve the budget, or the cabinet falls and new elections must be held.

That means that for the first six months of 2009, the government will have been operating without any budget. The law provides for that eventuality: It continues to base its actions on the budget for the year before, in this case 2008, but it is prohibited from deviating from the 2008 budget by a shekel. No new initiatives may be promoted. Money for the new ministries Prime Minister Benjamin Netanyahu has created comes from the budget for the Prime Minister's Office.

Under the coalition agreement between Likud and Labor, the draft budget will also be presented to the leaders of the Histadrut labor federation and manufacturers, who have veto rights over certain parts.