Israeli Supreme Court Ends Tax Benefits for Yeshivas with Draft Dodgers

The Israeli Supreme Court ruled on Thursday that yeshivas (Jewish religious schools) where students evade military conscription will no longer qualify for tax benefits under Section 46 of the Income Tax Ordinance. This decision followed a petition by the organization Israel Hofsheet (Free Israel), which argued that tax credits granted to donors effectively constitute indirect public funding of institutions harboring draft evaders, a practice previously ruled unauthorized by the court.

During the proceedings, the state largely accepted Israel Hofsheet's position, agreeing to cease granting or renewing Section 46 approvals to such institutions and to revoke existing approvals. The government has already begun implementing this policy immediately. The court noted that since the petition's main demands were met and practical steps taken, no further judicial oversight was necessary at this stage. The justices refrained from commenting on the finer details of the new policy, which may be challenged separately.

Israel Hofsheet CEO Tal Gal and activist Uri Kedar welcomed the ruling, stating it officially ends the era of tax deductions for donations to yeshivas attended by draft evaders. They emphasized the government's responsibility to stop subsidizing institutionalized draft evasion and called for equality in conscription obligations.

Earlier this month, the Israeli Tax Authority informed dozens of yeshivas and Torah study institutions that they would no longer be eligible for tax benefits if their students had not regularized their military service status. This move is part of a broader effort to discourage draft evasion among ultra-Orthodox communities.

The ruling marks a significant shift in Israeli policy, aiming to align public funding mechanisms with national conscription laws and reduce indirect support for draft evasion.