The Knesset on Monday evening approved a law that offers a 35-percent tax break on donations to NGOs that encourage settlement anywhere in the country, including in Judea and Samaria.

The legislation passed a final reading in the plenum by 33 to 13, after a brief debate.

The amendment to an existing law offers an income tax exemption worth up to 35% of the amount of a donation.

Its opponents say the bill was designed to direct tax breaks to those who support West Bank settlements.

One of the measure’s sponsors, coalition chairman Ze’ev Elkin (Likud), previously argued that the bill was conceived to help the Negev and the Galilee, but the language was then expanded so that it was applicable to all Israeli communities.

Initially, the bill’s language spoke of “Zionist” settlements, but the word has since been struck, so that non-Jewish Israeli communities can also receive the tax breaks.

In a meeting earlier this month, Knesset Finance Committee chairman Moshe Gafni (United Torah Judaism) reported that he had received a letter from legal expert Frances Raday, who had advised him that tax-breaks that include West Bank settlements are illegal under international law.

In the plenum on Monday, Gafni said Raday was wrong. He spoke in support of the bill, which he said had very broad implications that included welfare and education.

This measure, he said, bears no relationship to politics, and is neither a right-wing nor a left-wing bill.

MK Dov Henin (Hadash), however, urged the parliamentarians not to be fooled.
The bill’s true intent was to create a new funding mechanism for West Bank settlements, he said. Israel’s settlement policy is designed to create facts on the ground that would prevent a two-state solution, he said.

“If we seek a just peace for both nations, we should oppose it,” Henin said.

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