Labor and the Coalition have voted down a Greens amendment to strip tax breaks from charities funding illegal Israeli settlements and the IDF. Stephanie Tran reports.
The Labor Government has joined with the Coalition to vote against a Greens amendment which would have stripped deductible gift recipient status from Australian organisations found to be supporting an illegal occupation by funding Israeli settlements and organisations linked to the IDF.
Greens senator Mehreen Faruqi introduced the amendment in the Senate this week, arguing that Australian taxpayers should not subsidise organisations whose funds support illegal settlements in the occupied West Bank.
Genocide is a war crime. Ethnic cleansing is a war crime.
But in this country, you can send money to fund those war crimes, and you’ll receive a tax deduction,” Faruqi told the Senate.
Both Labor and the Coalition opposed the amendment.
Faruqi referenced investigations by Michael West Media which revealed that Australian charities registered with the Australian Charities and Not-for-profits Commission (ACNC) were hosting fundraisers linked to the IDF and Israeli settlements in the West Bank while benefiting from DGR status.
“These charities are helping to bankroll the genocide in Gaza by channelling funds to organisations linked to the IDF and to violent illegal settlements off the back of Australian taxpayer money.”
The proposed amendment would have amended the Income Tax Assessment Act 1997 to provide that an entity would not be entitled to DGR endorsement if it had supported an “illegal occupation”.
Last month, the UK Charity Commission launched an investigation into charities in England and Wales donating funds to illegal Israeli settlements in Palestine.
ACNC rules “don’t extend to … international law”
Faruqi said the amendment was necessary because the existing regulatory framework did not adequately address conduct that breached international law.
“By maintaining DDR status for these supposed charities, the government says that this violence is okay. That is what this government is doing. That these murders are okay. That this ethnic cleansing is okay,” she said.
“How can supporting ethnic cleansing, settler occupation, and murdering Palestinians be ensuring the safety of vulnerable individuals overseas? It cannot and the ACNC has not been able to answer these questions.”
When she previously moved the amendment in March, Labor senator Anthony Chisholm told the Senate that the ACNC’s external conduct standards did not extend to conduct under international law.
Faruqi said that meant charities could continue to fund activities that are unlawful under international law while retaining their tax concessions.
“Labor is more than happy for those who participate in, sustain, and fund the illegal occupation of the West Bank, an occupation that Labor itself has recognised as illegal, yet it gets a tax deduction,” she said.
Labor senator Tim Ayres said “charity registration can be revoked by the ACNC where the governance and external conduct standards are not met”.
However, Ayres reiterated the government’s previous position that “the external conduct standards don’t extend to conduct under international law.”
Subsidising illegal occupation
Faruqi challenged Ayres over whether the ACNC was investigating specific organisations identified in MWM investigations.
She cited the Chai Charitable Foundation, which received more than $19m in tax-deductible donations in 2025 and had hosted campaigns for organisations that publicly stated they provided direct support to IDF soldiers.
She also referred to reporting by MWM which revealed that the Foundation had hosted fundraising campaigns linked to settlements in Tekoa and Hebron in the West Bank.
Faruqi also cited investigations on United Israel Appeal Australia, which reported $50m in revenue in 2024, and funded the Lone Immigrant Soldier program, which provides support to immigrants serving in the IDF. The organisation has also funded settlement-related activities in the West Bank.
“Minister, do you know if the ACNC is investigating these organisations?” Faruqi asked.
Ayres heads off allegations
Ayres responded that “the ACNC is an independent regulator and it’s accountable for the work that it does on an independent basis”.
When Faruqi pressed him on whether he should know whether the organisations were receiving tax deductions and whether the allegations demonstrated that existing safeguards were insufficient, Ayres said he could not respond to questions about individual organisations.
Faruqi challenged the government over the external conduct standard requiring charities operating overseas to take reasonable steps to protect vulnerable people.
Palestinians living under occupation, displacement, and genocide
are clearly vulnerable people. Australians are deeply distressed that tax-deductible donations may be supporting organisations connected to the very forces and settlements harming them,” she said.
“Minister, why won’t the government listen to those concerns and support this amendment, so that it can be crystal clear that Australian tax concessions cannot be used to subsidize what your own government recognizes as an illegal occupation? What is the problem here?”
Ayres said the government’s “approach in relation to the broader question has been very clear”.
“I don’t really understand the relationship that you’re trying to draw between the purposes of this piece of legislation, which is about DGR status and a whole range of things,” he said.
Escalating settler violence
The amendment comes as violence against Palestinians in the occupied West Bank has escalated, with two Palestinian teenagers murdered last week by Israeli troops.
Sixteen-year-old Khalil Abu Alia and 19-year-old Omar al-Nassan were killed in the Palestinian village of al-Mughayyir after settlers entered the village under police and military escort.
Abu Alia, who was about to begin year 11, was shot in the neck while standing on the doorstep of his home. Al-Nassan, who had recently graduated from the same school, was also shot and died before reaching hospital.
The two teenagers were among five students from the same school killed in Israeli attacks this year. The other victims included a 17-year-old Palestinian youth footballer and two 14-year-olds.
At the same time, Israeli forces demolished the homes of 12 Palestinian families in Khirbet al-Taban in the South Hebron Hills, leaving all 70 residents homeless, including 28 children, according to Israeli human rights organisation B’Tselem.
The organisation said the community was the 66th Palestinian community to have been wiped out since October 2023.
“These are whole worlds and lives extinguished in evil, depraved, and violent attacks that have become part of everyday life for Palestinians,” Faruqi said.
Coalition, Nats, Labor, One Nation – same deal
The Coalition also opposed the amendment.
Nationals senator Bridget McKenzie accused Faruqi of conflating support for the IDF with criminal conduct and criticised what she described as “abhorrent anti-Semitic comments”.
“Listening to Senator Faruqi, it would seem that supporting the IDF or the families of the IDF is somehow now a crime in Australia,” McKenzie said.
She said the Coalition would not support the amendment and “look forward to voting no as soon as possible”.
Faruqi, meanwhile, argued that the amendment was about preventing Australian tax concessions from supporting activities Australia itself recognises as unlawful.
“The International Court of Justice, in 2024, called on parties, states such as Australia, to prevent trade or investment relations that assist in the maintenance of illegal situations created by Israel in the occupied Palestinian territories,” she said.
“Labor allows Australian charities to funnel money to support ethnic cleansing, apartheid, violence, and occupation.” She accused Labor of hypocrisy
over its position on Palestinian statehood and Israeli settlement expansion.
“It is completely disingenuous for the government to say it supports a Palestinian state while effectively subsidising its destruction,” Faruqi said.
“Supporting these heinous crimes deserves a criminal investigation, not a tax deduction.”
“Labor says they mourn the death of Zomi Frankcom, but in the same breath, they hand tax benefits to those who support the murderers.”
