The Wiz effect: How a $32 billion exit could reshape Israel’s fiscal plans
A major tax windfall gives the government financial breathing room—but will it be used to cut the deficit or expand spending?
The acquisition of Wiz by one of the world's five largest companies is far more than just another event for the Israeli high-tech community—it is a macroeconomic event. The reason lies in the scale of the deal: $32 billion, or roughly 120 billion shekels. While it is already clear that not all of this amount will reach Israel, as the company is registered abroad, a significant portion is expected to enter the country since the founders and many employees are Israeli.
The government and Finance Minister Bezalel Smotrich are particularly interested in the four Israeli founders, each expected to receive around $3 billion. In addition, the company’s 1,800 employees are set to receive another $1.5 billion, many of whom are Israeli. According to estimates by the Tax Authority, between 12 and 13 billion shekels are expected to flow into Israel’s state coffers in the coming months. Not all of it will arrive at once, and not necessarily under the same tax category, but that is the "golden number" officials are eyeing. This sum represents 0.6% of GDP, meaning that if the deficit for 2025 was projected at 4.9% of GDP, it could now be revised to 4.5%.
This shift would allow the government to cancel some of the planned budgetary measures that have yet to be approved and use the funds to help cover the deficit—some of which stems from sectoral allocations to the ultra-Orthodox and settlers. A lower deficit would also help reduce government debt, which has already reached 70% of GDP. However, it is also possible that this influx of funds will only encourage Smotrich and Netanyahu to further expand the deficit.
Another key impact relates to the exchange rate. The injection of $13 billion into the economy by Israelis will create excess demand for the shekel, likely strengthening it against the dollar. While foreign exchange markets are influenced by multiple factors, such a significant inflow cannot be ignored.
Moreover, an exit of this magnitude—especially during a time of war and political instability—could boost investor sentiment toward Israel. The message emerging from the deal is clear: “There is politics, there is war, but Israeli high-tech stands above it all.” This could attract both long-term investors and short-term financial players, further supporting the shekel. At a time when investments in the economy fell by 1.6% in 2024 and forecasts for 2025 remain uncertain, the Wiz deal provides a rare bright spot for a sector that has been hit hard by the judicial overhaul, rising global interest rates, and the war in Gaza. And this is not just any growth—it is “healthy” growth, as it is long-term and sustainable.
There is also hope that the government will recognize the vital role of high-tech professionals—who have been labeled "anarchists" and "Kaplanists"—in driving Israel’s economic growth. It is worth recalling that Wiz CEO Assaf Rappaport has spoken out about the damage caused by the judicial overhaul.
Furthermore, entrepreneurs like the founders of Wiz will not be spending their $3 billion windfall on luxury suits or watches. Those in this industry are already thinking about their next ventures, from which the successful companies of the future will emerge. Many of the 1,800 employees—after buying a home in a desirable location—will go on to launch their own startups. This is the natural cycle of Israeli high-tech: entrepreneurs beget more entrepreneurs, who build companies, sell them, distribute the proceeds, and start anew.
