Israel's Knesset parliament on Sunday passed a law offering upwards of 35 percent tax breaks for what the bill's rightist sponsors call "strengthening Zionism and encouraging Zionist settlement."

Ruling Likud party lawmakers Zeev Elkin and Tzion Pinyan submitted the bill to the Ministerial Committee on Legislation, charging that "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," according to the Haaretz daily.

The two said that "... the profit that will accrue to the state, including economically, will be infinitely greater," than any financial losses stemming from the tax exemptions.

The bill's opponents contend that the legislation's vague wording, which could refer to areas both within Israel proper, and beyond the 1967 war cease-fire lines, is meant to mask boosting financial support for settlement activity in the West Bank.

In comments to Xinhua on the bill, left-wing Meretz party chairwoman Zahava Gal-On called the ruling "cynical."

The bill, "exposes the true intentions of the (Prime Minister Benjamin) Netanyahu government regarding the peace process and the possibility of a viable and sustainable two-state solution," Gal- On said.

Two weeks ago, the cabinet approved an incentive program with development subsidies and housing loans for hundreds of communities that included some 70 settlements in the West Bank.

However, the Prime Minister's Office said that the program, covering 557 communities, will not be valid in the West Bank before Defense Minister Ehud Barak gives to go-ahead for providing benefits to any community in the West Bank.

According to the statement, the benefits include subsidies for development costs up to 150,000 shekels (40,000 U.S. dollars) in rural areas and 107,000 shekels (28,000 dollars) in cities, and supplementary housing loans of up to 100,000 shekels (26,500 dollars).

Israel has made a prior commitment to the United States not to offer such incentives beyond the 1967 war lines.

An earlier PMO press release said that the decision is aiming to encourage positive migration to the communities and to assist in finding solutions to ease the housing situation, adding that it will also contribute to the local economy.

Some opponents on the left condemned the cabinet decision. Peace Now Settlement Watch director Hagit Ofran said that the move is another proof of the government's support for the settlements.