Yeshiva Administrators Ask High Court to Halt Tax Benefit Changes

The Union of Yeshiva and Torah Institutions Administrators has filed an urgent request with the High Court of Justice (Bagatz) to halt a policy change concerning tax benefits for donations to religious institutions. The change, related to Section 46 of the Income Tax Ordinance, allows donors to recognized institutions to receive tax credits. Under the new policy, these institutions must provide information about their students to the tax authorities to verify their status with the military draft.

The Union claims that the Tax Authority has sent letters to hundreds of institutions demanding affidavits and lists of students, including their ID numbers, by October 11. Institutions failing to comply risk losing their eligibility for the tax benefit, which could lead to significant financial damage as donors may redirect their funds elsewhere.

The Union is asking the High Court to freeze the policy change until the court can hear petitions on the matter, with a hearing scheduled for December 28. They argue that the new policy could take effect before this date, causing irreparable harm.

The background to this move is the position of the Attorney General, who stated that tax benefits cannot be used as indirect funding for religious institutions where individuals obligated for military service have not regularized their status with the army. The Union contends that this policy unfairly penalizes entire institutions due to the status of a portion of their students.

They are seeking an interim order from the High Court to maintain the status quo until a decision is made, or at least to require the state to submit its response before the changes are implemented.