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Likud and Yisrael Beiteinu Wednesday proposed a new bill aimed at limiting foreign funding to Israeli nongovernmental organizations by replacing two bills that have been frozen by Prime Minister Benjamin Netanyahu. The Ministerial Committee for Legislation is expected to debate the new bill on Sunday.

According to left-wing activists, European parliamentarians say the new bill will damage Israel's relations with Europe. Meanwhile, opposition members and NGO representatives accuse Netanyahu of conducting a witch hunt against groups that criticize his government and of intending to gag the media, justice system and civil society.

The new bill would replace two previous proposals sponsored by MK Faina Kirshenbaum (Yisrael Beiteinu ) and MK Ofir Akunis (Likud ).

The bill calls for a complete prohibition on foreign funding to NGOs that deny Israel's right to exist, incite racism, support armed resistance against Israel, support putting Israeli officials on trial in international courts, call on insubordination in the army and support boycotts against Israel.

According to the proposal, all organizations that do not receive funding from the Israeli government will have to pay a 45 percent tax on foreign funding. The organizations will be able to ask the finance minister for a tax exemption based on criteria yet to be decided on.

The bill applies to all human rights organizations operating in Israel.

Organizations that receive state funds may continue to receive unlimited tax-free contributions from foreign governments.

"Many organizations operating in Israel have made it their goal to denounce the state to the world and turn the IDF's soldiers and officers into persecuted people with damaged reputations," the bill's explanatory notes say. "These organizations, often calling themselves 'human rights organizations,' receive funds from states and covert sources whose sole aim is to damage and change the public-political discourse in Israel."

The sponsors say most of these organizations' funds come from European Union countries such as Britain, Switzerland, Norway, Spain, Germany and Ireland.

According to left-wing activists who spoke with members of the European Parliament this week, Europe sharply criticized the Israeli government's intent to advance the bill.

Parliament members said that if Israel discriminates against particular organizations, Europe may stop funding Israeli social organizations that receive support from the government. The European officials also warned against the deterioration of ties between Israel and Europe if the bill is approved.

"This is what the thought police looks like," said Yariv Oppenheimer, Peace Now secretary general. "Netanyahu is revealing himself as no less than a dictator who uses legislation to gag the media, the justice system and civil society."

MK Nachman Shai (Kadima ) said "the new NGO bill clips the wings of Israeli democracy. The limitations would damage civil society's independence and freedom of action. There is no democracy without a lively, active civil society. As usual, the prime minister chooses to shut the mouths of those whose voices he cannot tolerate."

MK Zahava Gal-On (Meretz ) said "the witch hunt continues. The new bill is even worse than the first because it convicts and penalizes without a trial groups that criticize the government."

She urged Netanyahu to freeze this bill as well and stop disgracing Israel with his party's proposals.

The Jewish-Arab coalition of social organizations Shutafut-Sharaka - consisting of Shatil, Sikkuy, Itach and Keshev, all of which will be harmed by the legislation - was furious at what it called "Netanyahu's trick."

"Netanyahu is mocking the public. On one hand he said he's freezing the bills capping the funds to the NGOs, while at the same time he's advancing so-called new bills against NGOs. Netanyahu should learn a lesson from civil society organizations about what democracy and democratic values are."