Israeli Parliament Approves Law Canceling Kashrut Reform, Raising Public Costs by 600 Million Shekels

The Israeli Knesset approved a law early Wednesday morning to cancel the Kashrut reform, passing it with 46 votes in favor and 41 against. The legislation preserves the Chief Rabbinate's monopoly over kosher certification, blocks market competition, and transfers 5,000 kosher supervisor jobs to the Ministry of Religious Services and the Shas party. According to a Finance Ministry calculation revealed by Calcalist, this law will impose an additional cost of 600 million shekels on the economy, contributing to higher living expenses.

The increased costs stem from maintaining dual kosher certifications, both from the Chief Rabbinate and independent kosher organizations (Badatz), and raising kosher supervisors' wages by 20%, estimated at 110 million shekels. The Chief Rabbinate's monopoly allows it to impose stricter kosher requirements and additional fees, which can lead to abuses and inflated costs. The law also grants the Rabbinate exclusive authority to certify imported kosher products, preventing thousands of foreign kosher food items from entering the Israeli market.

The Finance Ministry's Budget Department explained in a response to MK Miki Levy (Yesh Atid) that eliminating competition in kosher certification directly raises kosher costs, food prices, and overall living expenses. The law also places kosher supervisors under state-related corporations, increasing employment costs that businesses will likely pass on to consumers.

The canceled reform, initiated in 2021 by the Yamina and Yisrael Beiteinu parties, aimed to open the kosher certification market to private corporations and reduce the Rabbinate's control. The reform sought to allow private certification bodies to operate, including for imported products, potentially lowering costs. However, the Shas party blocked its implementation and now succeeded in repealing it. The law also consolidates Shas's control over kosher supervisors, threatening the state with a half-billion shekel employment liability.

Critics, including Tani Frank of the Hartman Institute, warn that the law entrenches monopolistic inefficiencies and costs, while the Chief Rabbinate's former CEO Yehuda Cohen recently authorized the religious Zionist organization Tzohar to operate as a kosher certification corporation. Tzohar is currently assessing its legal options following the law's passage, including possible Supreme Court petitions or awaiting a future government to repeal the law.

A 2019 report estimates about 5,000 kosher supervisors provide 8.5 million supervision hours annually at a cost of roughly 500 million shekels. A 2015 Finance Ministry-commissioned report calculated kosher certification costs at 3.4 billion shekels annually, with 600 million attributed to the Rabbinate's monopoly. Adjusted for inflation and population growth, total kosher-related costs now reach approximately 5 billion shekels per year. No updated cost assessments have been made since the ultra-Orthodox parties joined the government.