The Ministerial Committee on Legislation will discuss on Sunday a bill recognizing donations to "Zionist settlement" for tax purposes. The bill would confer a tax exemption of up to thirty-five percent on such donations.

The bill did not specify whether "Zionist settlement" referred to settlement in the West Bank or anywhere in Israel, although in practice it most likely means giving assistance to organizations that promote settlement beyond the Green Line.

Currently, Israel's tax authorities recognize donations to institutions that promote defined public goals, among them culture, education, religion, science and health, as well as other institutions defined by the finance minister as promoting public goals.

The bill's sponsors, Likud MKs Zeev Elkin and Zion Pinyan, seek to add "strengthening Zionism and encouraging Zionist settlement" to the list.

"In these days of constantly eroding values in general, particularly the values of Zionism and settlement, it is appropriate to return to these values their precedence and restore them to their proper place," they said.

Elkin and Pinyan estimated that the income lost to the state due to the amendment would be "minimal."

"In any case, the profit that will accrue to the state, including economically, will be infinitely greater," they added.

Last week, the cabinet withdrew housing benefits from 70 West Bank settlements, unless specifically approved by the defense minister, who has authority over West Bank construction.

The decision amended a cabinet resolution approved on Sunday that granted various housing benefits to people living in national priority areas. Since about 70 settlements are located in national priority areas, the new decision was passed to exclude them.

Sources in the Prime Minister's Office said the amendment was not included in Sunday's resolution because that resolution simply expanded a 2009 decision, and the latter already stated that granting housing and infrastructure benefits in the territories would require special approval from the relevant political officials.

"We decided to add the provision to [Sunday's] resolution to remove any doubt," a senior official in the Prime Minister's Office said. "But there is no change in policy here, either for better or for worse."