The ruling coalition narrowly advanced crucial legislation needed to adopt the 2026 state budget after ultra-Orthodox lawmakers agreed to support the bill, despite earlier threats to block it over stalled draft exemption reforms. To expedite the process, the coalition split the Arrangements Law into two bills, omitting controversial reforms from the portion tied to the budget's passage. After intense negotiations, enough support was secured for the measure, though some members of the ultra-Orthodox bloc still voted against it.

The approved bill includes key financial reforms such as opening up the banking sector, loosening dairy import tariffs, and introducing a tax on e-cigarettes, while other reforms in energy and urban planning are postponed. The vote allows committees to begin deliberations, speeding up the legislative process. However, ongoing disagreements over draft exemptions for yeshiva students threaten the coalition's stability, raising the possibility of early elections if the budget is not finalized by March.