Israel is experiencing NGO tax bill deja vu - analysis

In the world of news, 2016 was eons ago, but anyone who still remembers that bygone era may have felt some déjà vu over the weekend.

“Israeli NGO tax bill likely shelved after attack by ambassadors, embassies,” read the headline of an article by The Jerusalem Post’s Eliav Breuer. “Dutch, German ambassadors: ‘Unhindered’ relations between civil societies are an ‘essential value’ in liberal democracies.”

Here’s a headline from July 2016: “EU says Israel’s new NGO law risks ‘undermining values.’”

“Israel enjoys a vibrant democracy, freedom of speech and a diverse civil society... This new legislation risks undermining these values,” the European Commission said at the time.

Back then, the Knesset passed the “NGO Transparency Law,” requiring nonprofits that receive most of their funding from foreign governments – the vast majority of which were and are left-wing and criticize Israel’s treatment of the Palestinians – to specially report the contributions, including stating that fact in all of their publications.

The MKs involved in the NGO tax bill

The law, proposed by Finance Minister Bezalel Smotrich (Religious Zionist Party) and a former MK from Yisrael Beytenu, passed after years of debate over foreign funding of NGOs and many starts and stops before a tempered version of the legislation reached its final vote.

This weekend’s throwback news came courtesy of Likud MK Ariel Kallner, who proposed that foreign government contributions to NGOs be taxed at 65%. As was the case with several similar proposals pre-2016, when the objections came pouring in from the West, Prime Minister Benjamin Netanyahu took the bill off the Ministerial Committee for Legislation’s agenda.

If 2016 is any indication, though, there’s a good chance the latest NGO bill will make a comeback, even if some of its sharpest edges are filed down.

And the reason for that is that governments, mostly in Europe, and the NGOs they fund have not substantially changed their behavior since the transparency requirements were put in place.

No country likes other countries intervening in their affairs. Still, there might be more understanding in Israel if the donations were going to what one might typically define as “civil society” organizations – groups that focus on Israeli society, such as “human rights defenders, human rights NGOs, bar associations, student clubs, trade unions, university institutes, bloggers, environmental rights activists or charities working with discriminated groups,” to name some of the examples in a UN Office of the High Commissioner for Human Rights definition of the concept.

The other examples the OHCHR gave are “human rights defenders and human rights NGOs,” but as a recent report by the research institute NGO Monitor said, there is a “deep politicization of the universal human rights discourse… demonstrations of bias and the absence of credible and consistent criteria.”

The behavior that sparks these NGO laws is, generally, when foreign-funded NGOs try to intervene in the Israeli-Palestinian conflict by making extreme anti-Israel statements around the world, advocating for Israel to be put on trial for alleged war crimes and similar actions.

For example, Breaking the Silence, whose representatives travel the world, claiming Israel committed war crimes, received 55.6% of its funding from foreign governments in 2017-2019, according to NGO Monitor. They include Switzerland, France, Norway, Spain, Ireland, Denmark, Belgium and more. B’Tselem received 49.7% of its funding from foreign governments in the same period of time, with international donors including the EU, Norway, the Netherlands, France, the UK and more, and is active in promoting the claim that Israel is an apartheid state.

Some of these governments, while funding an effort to tar Israel as an apartheid, war-crime-committing state, have expressed the opposite view about Israel themselves.

For example, French President Emmanuel Macron asked last year: “How dare we talk about apartheid in a state where Arab citizens are represented in government and positions of leadership and responsibility?”

Then there are organizations such as Israel-based 7amleh, whose official social-media accounts and those of its senior members celebrate and praise terrorists and terrorist attacks against Israel and call for boycotts of Israel – activity that is designated as antisemitic in Germany, which is also one of the foreign governments donating to the NGO.

And that’s without getting into the Palestinian-based NGOs that get funding from foreign governments. Several affiliates of the EU- and US-designated terrorist group the Popular Front for the Liberation of Palestine, such as Addameer, Al-Haq and Defense for Children International-Palestine, among others, receive foreign government funding.

As far as Israeli law is concerned, donors such as the EU, Norway, Ireland, Italy, France and Spain have been funding terrorism. That being said, those donations would not fall under the NGO bills pertaining to groups in Israel.

According to NGO Monitor founder Prof. Gerald Steinberg, who has long been the leading voice in Israel on these issues, “These issues… are complex and important, requiring detailed understanding of the extent and political impact of foreign government funding under the label of ‘civil society’ and nongovernmental organizations, especially those seeking to deny Israel’s right to exist as a Jewish and democratic state.”

While not taking a stance on Kallner’s bill, he “called for governments to engage in a bilateral dialogue on these important issues,” and NGO Monitor has shared its findings with governments around the world.

Off the table for now

For now, the NGO bill is off the table. But as long as foreign government contributions flow into groups that use “human rights” as a battering ram against Israel in ways that not only Jerusalem finds objectionable, but those very governments oppose as well, they should not be surprised if it comes back soon.

If Western countries want to avoid this ritual every few years, they would be wise to consider Steinberg’s call and maybe a new approach. There are many NGOs that are not getting millions of euros and do admirable things for Israeli society.