The Labor government has told the Senate that Australian charities don’t have to comply with international law, nor will they be compelled. Michael West Media reports.
SPECIAL REPORT: By Stephanie Tran
The Albanese government has rejected a proposal to strip tax-deductible status from Australian charities found to be supporting illegal occupations, amid mounting scrutiny over donations flowing to Israeli settlements and the Israel Defense Forces (IDF).
Michael West Media has identified 5 charities either sending money to the IDF or to parties associated with illegal West Bank settlements in Occupied Palestine.
The proposed amendment, introduced by Greens Senator Mehreen Faruqi, would explicitly bar organisations from receiving deductible gift recipient (DGR) status if they are found to have supported an “illegal occupation”.
“The fact that people are sending money to support the war crimes of the Israeli military and to expand illegal, violent settlements in the West Bank is bad enough, but that Australian taxpayers are subsidising these settlements is completely outrageous,” Faruqi said.
“Supporting these heinous crimes deserves investigation, not a tax deduction.”
The amendment, circulated in the Senate as part of the Treasury Laws Amendment (Supporting Choice in Superannuation and Other Measures) Bill 2025, would insert a new provision into the Income Tax Assessment Act 1997 denying DGR endorsement to any entity that has “advocated, prepared, planned, assisted in, financed, fostered, supported … or contributed to the establishment, maintenance or expansion of the illegal occupation”.
It would also empower the foreign affairs minister to formally declare what constitutes an “illegal occupation” for the purposes of the law.
Charities funding illegal settlements
This year, MWM released a series of investigations revealing that Australian charities are funnelling tax-deductible donations to projects linked to Israeli settlements in the occupied West Bank, which are illegal under international law, as well as to initiatives supporting IDF soldiers.
In the Senate debate on the amendment, Greens Senator Penny Allman-Payne cited the findings of the MWM investigations.
She highlighted figures showing that Jewish National Fund Australia had remitted more than $125 million to Israel since 2009, while the United Israel Appeal Refugee Relief Fund had transferred approximately $376 million since 2013 via Keren Hayesod, with a portion of these funds used for settlement expansion and IDF-linked programmes.
Allman-Payne also referenced the activities of the Chai Charitable Foundation, which earlier this year hosted fundraisers for organisations providing direct support to IDF soldiers and settlement communities, including in Tekoa and Hebron, before removing the campaigns following questioning by MWM.
“It is obviously of significant concern if there are charitable organisations in Australia that are funnelling funds to illegal occupiers and illegal settlements,” Allman-Payne told the Senate.
She noted that the Australian Charities and Not-for-profits Commission (ACNC) had received 896 complaints relating to 88 charities in connection with the Israel-Gaza conflict between October 2023 and December 2025.
“Given that these donations are tax-deductible . . . that effectively means taxpayers are subsidising illegal occupation and militarisation,” she said.
Government rejects amendment
In response, Finance Minister Katy Gallagher stated that the government would not support the Greens amendment, arguing that existing regulatory frameworks already prohibit unlawful conduct by charities.
“There is no DGR category or purpose that allows charities to support illegal activities at home or abroad,” Gallagher said.
She pointed to the ACNC’s governance standards, which require charities to operate lawfully and remain accountable, as well as external conduct standards governing overseas activities.
However, Gallagher acknowledged a key limitation: those standards require compliance with Australian law, but
do not extend to conduct under international law.
Charities operating overseas must take “reasonable steps” to ensure proper governance and compliance with Australian legal obligations, including sanctions, anti-money laundering and counter-terrorism financing laws, she said.
Organisations found to be in breach risk losing their charitable registration, which can in turn lead to the loss of DGR status.
Referral for investigation
Gallagher suggested that concerns about specific organisations should be referred to the ACNC for investigation.
Faruqi said the government’s position amounted to wilful inaction.
“The Labor government clearly wants to keep its head in the sand and is looking the other way while this happens,” she said.
“This is just another example of the government’s complicity in the ethnic cleansing of Palestine.
“It is two-faced for the Government to say it supports a Palestinian state while effectively subsidising its destruction.”
Minister Gallagher and Andrew Leigh (Assistant Minister for Productivity, Competition, Charities and Treasury) were contacted for comment.
Regulatory obligations
A spokesperson from Leigh’s office provided the following response:
“The government expects all registered charities to meet their regulatory obligations and to obey all Australian laws. This is a condition of maintaining charitable status.
“The ACNC is the independent regulator of charities and complaints involving conduct that could harm people or involving the misuse of a charity for terrorism purposes or to foster extremism are a compliance priority for the ACNC.
“The ACNC already has powers to revoke the charitable status of charities involved in serious illegal activity.”
Stephanie Tran is a journalist with a background in both law and journalism. She has worked at The Guardian and as a paralegal, where she assisted Crikey’s defence team in the high-profile defamation case brought by Lachlan Murdoch. Her reporting has been recognised nationally, earning her the 2021 Democracy’s Watchdogs Award for Student Investigative Reporting and a nomination for the 2021 Walkley Student Journalist of the Year Award. This article is republished from Michael West Media with permission.
