The Knesset House Committee put on Monday's agenda for second and third reading the "bill to encourage settlements."
The controversial bill - proposed by coalition chairman Ze’ev Elkin (Likud) and MK Tzion Pinyan (Likud) - allows for a 35% tax exemption for pro-settlement donations.
Only a handful of MKs from Likud, Shas and the United Torah Judaism party were present to vote on whether or not to put the bill forward for second and third reading.
The bill was not due to be voted on Monday, however, due to the impending Knesset dissolution, it was placed on the agenda at the last minute
Israel has promised the international community it would not provide special incentives for West Bank settlement activity.
Hagit Ofran of Peace Now previously charged that the bill is a back-handed way of offering incentives for West Bank settlement development and activity.
Elkin has denied the charge. The bill amends the list of nonprofits whose donors can receive the exemption by, including groups and institutions that “encourage settlement,” he said.
Elkin noted that the language in the bill is broad and does not specify any specific region of the country.
He added that in proposing the bill, he had wanted to help Jewish development in the Negev and the Galilee. It could also be applied to Beduin villages, he said.
Elkin said he is pleased the government decided to encourage such activity in the Negev and Galilee, and recognizes that it is as important as cultural or religious organizations.
“This will put an end to the absurd situation in which the Islamic Movement gets tax benefits for building mosques, but non-profit organizations like Ayalim and Or [that encourage building towns in the Negev and Galilee] remained deprived,” the coalition chairman said.
But the words “Negev and Galilee” are not mentioned in the bill or its explanatory section.
Instead, the bill’s explanatory section speaks of encouraging “Zionist settlement.”
The bill must pass three plenum votes, as well as committee discussions, before becoming law.
Lahav Harkov and Tovah Lazaroff contributed to this report