Opposition leader MK Yair Lapid lambasted the legislation, accusing the coalition of having dismantled the Passover holiday.
Israel's coalition retracted its intention to pass the first reading of the "Gifts Law," which enables donations to politicians to cover legal and medical fees.
The bill passed 20-6 with support from opposition and coalition members.
The coalition claimed that the move was purely technical and the bill would not be voted on yet.
In continuation of legislative blitz, Hametz Law is expected to pass overnight, and Deri Law 2 is being prepared for second and third readings.
The president has opened the door for both government and opposition leaders to engage in a dialogue and avert a civil war.
Which bills were passed in the plenum on Monday overnight, and how far along are they in the process of becoming law?
Critics have said it is reminiscent of a 2012 Russian law that has since been used to crack down on dissent.
In Israel, certain rights are not explicitly legislated in Israel's quasi-constitutional Basic Laws but are instead derived from them by the court.
Two congressman, one of whom served in the IDF, have presented a potential bill sanctioning organisations funding Hamas
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