Israel could face its fourth election in two years after the ruling coalition failed to reach an agreement in last-ditch talks that ran into the early hours of Tuesday.
The coalition government of Prime Minister Benjamin Netanyahu’s Likud party and Defence Minister Benny Gantz’s Blue and White party has to agree on a budget by midnight (2200 GMT) on Tuesday evening, otherwise parliament will automatically dissolve.
A total of 49 of the 120 lawmakers voted against a bill to delay the budget agreement deadline by a week – 47 voted in favour, while the rest either abstained or were absent.
Without an agreement, a new election will take place on March 23.
The coalition between former rivals Netanyahu and Gantz faced issues from the start, but tensions have recently intensified.
The coalition agreement stipulates that the government must pass a two-year budget for 2020 and 2021. Netanyahu, however, is reneging on this and is arguing for a budget to be passed for the current year only, citing the coronavirus crisis as a reason.
However, critics believe he wants to prevent Gantz from taking over as prime minister in autumn 2021 – as the coalition agreement stipulates.
Other points of contention include the appointment of judges and the powers of the justice minister from the Blue and White party.
A corruption case against Netanyahu is under way, and Gantz has accused him of doing everything possible to avoid a conviction.
New elections could cost both Netanyahu and Gantz votes, partly due to the formation of a new party by Netanyahu’s rival Gideon Saar.