HaYovel is one of many groups in the United States using tax-exempt donations to help Jews establish permanence in the Israeli-occupied territories — effectively obstructing the creation of a Palestinian state, widely seen as a necessary condition for Middle East peace.
The result is a surprising juxtaposition: As the American government seeks to end the four-decade Jewish settlement enterprise and foster a Palestinian state in the West Bank, the American Treasury helps sustain the settlements through tax breaks on donations to support them.
A New York Times examination of public records in the United States and Israel identified at least 40 American groups that have collected more than $200 million in tax-deductible gifts for Jewish settlement in the West Bank and East Jerusalem over the last decade. The money goes mostly to schools, synagogues, recreation centers and the like, legitimate expenditures under the tax law. But it has also paid for more legally questionable commodities: housing as well as guard dogs, bulletproof vests, rifle scopes and vehicles to secure outposts deep in occupied areas.
In some ways, American tax law is more lenient than Israel’s. The outposts receiving tax-deductible donations — distinct from established settlements financed by Israel’s government — are illegal under Israeli law. And a decade ago, Israel ended tax breaks for contributions to groups devoted exclusively to settlement-building in the West Bank.
Now controversy over the settlements is sharpening, and the issue is sure to be high on the agenda when President Obama and the Israeli prime minister, Benjamin Netanyahu, meet in Washington on Tuesday.
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