IDF finance chief estimates Oct 7 war will cost $60 billion

The Israeli military’s finance chief, Brig. Gen. Dr. Gil Pinchas, warned in an interview with Mamon magazine that the Oct. 7, 2023, war with Hamas is set to be the longest and most costly in Israel’s modern history. Pinchas, who lives in Tiberias, was rushed that day to an urgent IDF General Staff meeting in Tel Aviv as the unprecedented attack unfolded, which left roughly 1,200 Israelis dead and 251 kidnapped into Gaza.

“Even during the war, the IDF did not receive a blank check or permission for unlimited spending,” Pinchas stated. “Budgetary considerations were never forgotten. The drive for efficiency and savings is deeply embedded in the army’s DNA."

He went on to highlight the strength of the military’s economic system. “Today, the military’s economic system includes about 400 economists, both women and men, including reservists, career personnel, and civilian employees,” Pinchas said. “It’s a strong system. I can say with confidence that this is the highest-quality team of economists in the country.”

The Oct. 7 attack quickly escalated into what Israeli leaders have described as a seven-front war with the Islamic Republic of Iran and its regional terrorist proxies Hamas, Hezbollah in Lebanon, the Houthis in Yemen and other pro-Tehran militias across the region. 

After more than two years of multifront fighting, Pinchas revealed that the Israeli military estimates the war’s total cost at around $60 billion.

“In the first months of the Iron Swords war, I spoke every evening with senior Treasury officials and together we produced cost estimates. As time passed, our calculations became more refined,” he explained. 

“In the end, you have to operate within a framework. There were cases where the primary consideration was the availability of a vital item, and we were forced to pay three or four times the standard price. These were very rare cases,” he added.

The of Bank of Israel Governor Amir Yaron estimated already in 2024 that the war would cost around $67 billion in military and civilian costs for the period 2023 to 2025. 

Pinchas revealed that Yaron visited the IDF’s headquarters in Tel Aviv at least once a month to receive fresh data on the military expenses. 

“Yaron, an outstanding central bank governor, is also a graduate of our unit,” the general revealed.

Pinchas stressed that the IDF’s war cost estimate is limited to military expenses and does not include reconstruction costs of damaged buildings or compensation payments to war-affected civilians. He assessed that the daily cost during the war amounted to around NIS 300 million ($80 million).

“Every item the IDF uses in combat has a price tag in shekels, detailed in a special, highly specific price book,” Pinchas explained. “The book is updated constantly, including during the war. We keep our finger on the pulse."

The general revealed that mobilization of 230,000 Israeli reservist troops constitute the single largest war cost component. 

“At the peak of the fighting, we mobilized 230,000 reservists and faced extraordinary logistical challenges,” he assessed. “We handled them successfully, and I immediately authorized hundreds of millions of shekels for these missions."

The Israeli military’s defense budget for 2027 is expected to reach NIS 115–120 billion ($31–33 billion). However, the general emphasized that part of this funding is invested in technological innovation, which later generates financial and productivity benefits for the country’s economy.

“The IDF invests heavily in innovation and technology that are later applied in civilian sectors, boosting productivity and accelerating growth,” Pinchas explained. “The faster the economy grows, the smaller the relative weight of the defense budget becomes. Growth and security are intertwined."