Treasury warns Torah study law could force 16% tax hike

Israel’s Finance Ministry has issued a stark warning about proposed legislation that would constitutionalise Torah study as an alternative to military service, cautioning that the measure could require a significant increase in direct taxation to compensate for lost economic productivity. Senior officials at the Treasury have expressed strong opposition to the bill being advanced by the government, warning of “serious harm to citizens” if the law proceeds in its current form. They argue that diverting resources away from the economy whilst perpetuating widespread draft avoidance would damage growth and place additional strain on military reserves and their families. The officials contend that the financial burden of exempting large numbers of citizens from compulsory military service would necessitate raising direct taxes by approximately 16 per cent to maintain the state’s fiscal balance. The warning comes amid ongoing tensions within Israel’s coalition government over the contentious issue of military conscription exemptions for ultra-Orthodox Jewish yeshiva students. Itzik Saidian, a representative of combat veterans’ organisations, has criticised the proposal from a different angle, arguing that wounded soldiers feel abandoned by the state. “We must give paramount value to those injured in combat,” Saidian stated, highlighting concerns that the government’s focus on the Torah study bill has overshadowed support for veterans and their rehabilitation needs. The dispute underscores deeper divisions within Israeli society about military service obligations, religious autonomy, and the fair distribution of national security responsibilities across different communities.

Source: Ynet — Original article in Hebrew.