In fresh move in tax dispute with Vatican, Israel freezes Notre Dame hotel accounts

In the latest episode in a long-running dispute between Israel and the Holy See, the Jerusalem municipality demanded on Monday that the Vatican-owned Notre Dame of Jerusalem Center pay overdue city property taxes of NIS 18 million ($5 million), placing a lien on the institution’s bank accounts until it settles the payment.

Religious institutions in Israel, including churches and monasteries, are exempt from paying property tax. However, in recent years, Israel has sought to come to an agreement with the Vatican that would place Church-owned commercial enterprises — like hotels and coffee shops — under taxation.

Shortly before Christmas, municipality lawyers wrote to Isracard and Visa, asking that they block Notre Dame funds, according to the site’s general manager, Yousef Barakat.

“We don’t have any money in hand,” Barakat told The Times of Israel on Monday evening. “This is a political issue that should be solved between Israel and the Vatican.”

The Notre Dame center, which includes a church and a guest house, has been working through the Vatican to solve the issue. READ MORE