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The Knesset on Wednesday approved a landmark law to expand financial support for Israel Defense Forces reservists, ending a prolonged political standoff that had stalled coalition activity. The legislation passed its final readings with 26 votes in favor and none opposed.
The new law introduces a monthly income supplement for reservists who earn below the income-tax threshold. Beginning in January 2026, these reservists will receive an average of NIS 3,000 per month for each month they serve, lifting their income up to NIS 9,800.
The changes will apply to reserve duty carried out during 2025. Legislators said the reform is aimed at addressing longstanding inequities and compensating those who shoulder the heaviest service demands.
Reservists who complete at least 110 days of annual service will qualify for the highest tax-credit tier. The law also stipulates that when reserve-duty requirements decline in 2028, the threshold for receiving the top credit will be adjusted proportionally.
Finance Minister Bezalel Smotrich, whose Religious Zionism party had boycotted Knesset votes until the bill was advanced, hailed the passage as a victory for fairness. “Those who contribute more, receive more,” he said. “This is a Zionist, moral and economic policy that rewards those defending the state.”
Smotrich’s boycott brought legislative work to a near standstill last week, escalating tensions within the coalition. The standoff ended only after he and Prime Minister Benjamin Netanyahu struck a compromise to advance the bill.
The legislation had already passed an initial reading months ago and received government approval in August, but it became mired in the Knesset Finance Committee. Disagreements centered on which reservists would benefit most and whether the structure unfairly favored higher earners.
Committee chair and Likud MK Hanoch Milwidsky was among the most vocal critics. He argued that the plan risked deepening socio-economic gaps and appeared designed to curry public favor rather than address systemic inequities.
“I can’t shake the feeling that the finance minister’s office is more concerned with appearances than substance,” Milwidsky said during committee debates. “When it comes time to do the real work, the details fall short.”
Despite concerns, Milwidsky voted in favor on Wednesday, saying the revised bill represented progress even if it did not fully resolve disparities. “This law is good for combat reservists,” he said. “But it is far from repaying the debt Israeli society owes them.”
Reservists have repeatedly voiced frustration over the toll of extended service since the Hamas attacks of October 7. Many describe strained marriages, shuttered businesses, deteriorating mental health, and mounting financial stress as months of reserve duty keep them away from their families and jobs.
Advocates say the law is an important step but warn that financial relief alone cannot address the deep personal cost. They argue that long-term planning, employer protections, and mental-health support must follow.
Coalition leaders hope the law will help stabilize relations within the government while also acknowledging the sacrifices of Israel’s reservists. For now, the legislation marks one of the most significant expansions of reservist benefits in recent years and signals a broad political consensus on the need to support those serving on the front lines.