U.S. President Donald Trump’s plan to end military aid to Israel by the end of this year leaves Israel with a funding gap. According to The Wall Street Journal, which cited a State Department document sent to Congress, Israel has outstanding U.S. arms orders that need roughly $10 billion in additional funding. It is also unclear what will happen to the aid Washington pledged through 2028.
Trump said Tuesday that he had agreed with Israeli Prime Minister Benjamin Netanyahu to end the $4 billion in annual U.S. financial assistance to Israel starting at the end of this year.
But the president did not clarify whether the move would cover both the military grants and the missile defense funding, or what would happen to already approved funding and existing arms deals.
The U.S. financing arrangement allows Israel to enter into multiyear arms purchase agreements based on future aid commitments, placing orders before it receives the funds to pay for them, according to a Congressional Research Service report. That leaves deals already signed on the strength of that aid, including for F-35 fighter jets, exposed if the money stops.
Josh Paul, founder of the organization A New Policy, told MBN that Trump could announce his intention to end the aid, but that decisions on future funding would rest with Congress, which approves appropriations annually.
A memorandum of understanding signed by the United States and Israel in 2016, under former President Barack Obama, provides for $38 billion in assistance to Israel over 10 years, from 2019 through 2028.
The package includes $3.3 billion annually in Foreign Military Financing to purchase U.S. military equipment, as well as $500 million for joint missile defense programs.
The memorandum does not constitute a legally binding commitment comparable to a treaty. Actual funding remains subject to annual congressional appropriations.
According to the document, the cost of these orders could be covered through U.S. aid, Israel’s own budget or a combination of the two.
Israel’s future purchases listed in the State Department document include 25 F-35 fighter jets, worth nearly $3 billion. Israel contracted to purchase the aircraft using U.S. aid, with deliveries scheduled to begin in 2028, according to the Israeli Defense Ministry.
It remains unclear whether the value of the deal is included in the $10 billion estimate cited by the State Department.
Paul told MBN that ending Foreign Military Financing would force Israel to pay for its existing and future arms deals with its own resources. But he stressed that funding arrangements are procedurally separate from the continued transfer of weapons and defense cooperation between the two countries.
Amos Yadlin, former head of Israeli military intelligence and president of the MIND Israel Institute, said changing the structure of U.S. aid was not inherently objectionable, but would require a gradual transition and a clear plan rather than a sudden decision.
He told MBN that the problem lies in how the transition is managed, warning that the relationship with Washington extends beyond military funding to include diplomatic and political support to shield Israel from decisions it considers hostile.
In Israel, Trump’s announcement caught officials in relevant government institutions by surprise. The Times of Israel reported that officials in the security establishment had not anticipated the announcement and had begun examining its potential consequences.
Estimates by economic officials cited in the report suggested that losing two years of aid could cost Israel roughly $8 billion, raising questions about how the government would finance expenditures previously covered by U.S. support.
In March 2026, the Knesset approved a revised Defense Ministry budget of approximately 143 billion shekels ($44.7 billion), after adding more than 30 billion shekels ($9.3 billion) to cover the costs of the war and military requirements.
The figure underscores the scale of Israel’s defense spending but does not mean the budget automatically includes provisions to offset any potential reduction in U.S. assistance.
In December 2025, Netanyahu announced a plan to invest approximately 350 billion shekels (about $108 billion) over a decade to strengthen Israel’s defense industry and reduce its dependence on foreign suppliers.
In January 2026, he said he wanted to gradually end Israel’s reliance on U.S. military aid over the next 10 years.
Trump’s announcement, however, points to a much shorter timeline, and came amid the U.S. midterm elections and the backdrop of congressional debate over the future of defense cooperation with Israel.
In February 2025, a bill was introduced to strengthen the defense partnership between the two countries, including cooperation in military and technological fields. It does not, however, call for ending direct military grants.
Separately, in June 2026, a Republican initiative emerged calling for an end to direct U.S. military aid to Israel.
Or Yissachar, a researcher at the Habithonistim Institute for National Security Policy, told MBN that ending aid could pave the way for a new model based on partnership and joint investment in artificial intelligence, military technology, cybersecurity and intelligence, rather than direct financial grants.
He said ending aid would not necessarily mean a decline in security cooperation. He does not expect the decision alone to weaken Israel’s military capabilities in the near term, arguing that Washington would, in his assessment, continue to uphold its commitment to maintaining Israel’s qualitative military edge.
He noted, however, that aid to Israel has become a divisive issue in American politics, and that shifting toward a technology-based partnership could ease some of the controversy surrounding direct financial assistance.
Details of the understanding Trump said he had reached with Netanyahu have yet to emerge, including what happens to the arms orders Israel placed on the strength of aid it expected through 2028.
Adapted and translated from the original Arabic.
