Israeli Treasury Warns New Torah Study Law Could Raise Direct Taxes by 16%

Officials in the Israeli Ministry of Finance have strongly opposed the government-backed Basic Law proposal that enshrines Torah study as a fundamental value. They warned that final approval of the law could severely harm the economy and citizens. According to the Finance Ministry, elevating Torah study above the principle of equality risks a major shift in budget priorities, broad resource diversion, and expanded economic benefits of uncertain scale.

The ministry cautioned that the law's economic impact extends beyond yeshiva budgets. Experts argue it could undermine government goals to integrate ultra-Orthodox citizens into the military and workforce, increase pressure on the reserve forces system, and damage long-term economic growth. The harshest warning stated that continuing this trend might necessitate a 16% increase in direct taxes in the future.

Originally, the bill equated the status of Torah scholars with that of IDF servicemembers, but after public backlash, the wording was changed. The current law declares that Israel places supreme importance on encouraging Torah study and recognizes long-term Torah students as making a significant contribution to the state and Jewish people.