Israel to impose 65% tax on human rights groups critical of the occupation state

A new bill is being proposed which will grant Israel powers to extend its crackdown on human rights groups. The Ministerial Committee on Legislation will put forward a plan on Sunday to impose a tax on 65 per cent of foreign donations to Israeli and Palestinian humanitarian and human rights groups.

The bill fulfils one of the promises made to the far-right National Security Minister Itamar Ben-Gvir’s Otzma Yehudit party by Prime Minister Benjamin Netanyahu as part of their coalition agreement at the end of last year. Lawyers warned against the plan at the time and said that the move is similar to steps taken against human rights organisations in undemocratic countries. According to the deal, the government will pass the law 180 days after it is sworn in.

If adopted, as is thought likely, the new tax will have a serious impact on human rights groups and NGOs. Some of Israel’s most prominent and best-known rights organisations, including Breaking the Silence, B’Tselem, Peace Now and Yesh Din, rely on foreign funding from the European Union and US. In 2021, B’Tselem joined other major human rights group in branding Israel as an apartheid state.

Michael Sfard, the legal adviser to Yesh Din, an organisation that acts to protect the rights of Palestinians in the West Bank, warned against the bill in December: “If this section passes, it will be a fatal blow to the human rights community in Israel. This is a similar step to those taken against human rights organisations in undemocratic countries such as Poland, Hungary and Russia. The inspiration comes from [Vladimir] Putin and [Victor] Orban.”

Sfard explained that the bill is intended to paralyse the activities of groups that criticise Israeli policies targeting the Palestinians. He added that the move by the extreme far-right Israeli government will not harm right-wing organisations such as Kohelet and Elad because, unlike human rights groups, most of the donations they receive from overseas come from private individuals and bodies whose interests, in general, are not concerned with promoting democracy and human rights.

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The US is reported to have conveyed its strong opposition to the legislation. State Department spokesperson Matthew Miller said yesterday that the US “supports the central role of NGOs as part of civil society” which are “critical to democratic and responsive transparent government.”

Germany’s Ambassador to Israel, Steffen Seibert, said on Twitter today that the bill “is a matter of grave concern to us and to many of Israel’s international partners.” He added that Germany intends to “continue to raise the issue with our Israeli friends.”

The Bill has also been denounced by the French Embassy. A spokesperson is reported as saying that the legislation is “deeply concerning” and emphasising the “critical role of civil society in the life of every democracy.”

Experts highlighting Israel’s steady drift towards authoritarianism pointed to the fact that, globally since the 1940s, official humanitarian and development assistance has generally been exempted from taxation. The introduction of taxation of this sort by Israel would, therefore, stand apart from normal good practice by a state and act as a disincentive for donors to support Israeli and Palestinian civil society. Should this happen, the resources of organisations critical to the provision of humanitarian relief and human rights protection would be depleted beyond recovery.

Last year, Israel’s crackdown on human rights groups saw the apartheid state accuse six NGOs which defend Palestinian rights of “terrorism”. The decision was met with universal condemnation, and seventeen European countries said that they would continue to support the Palestinian NGOs.