* Seminary students spared army conscription, get benefits
* New law ending decades-old army exemptions seen in weeks
* Many Israelis resent special treatment of ultra-Orthodox
By Maayan Lubell
JERUSALEM, Feb 5 (Reuters) - Israel's Finance Ministry said on Wednesday it was cutting funds to seminary students exempt from compulsory military service, in the latest battle between the Jewish state's secular majority and an ultra-Orthodox minority.
Seminary students, many of whom rely on state stipends, have for decades been excused from army service under blanket exemptions that have long stoked resentment in a country whose other Jewish citizens are called to duty at the age of 18.
The issue is at the heart of an emotional national debate.
"If you do not take on the duties, then why are you asking to get the privileges?" said Finance Minister Yair Lapid on Army Radio in an admonition to ultra-Orthodox Jews after halting the funding in line with a ruling from Israel's Supreme Court.
The court ordered the government on Tuesday to stop paying stipends to some seminary students, infuriating ultra-Orthodox community leaders who noted that in the absence of a new law, deferrals were still being issued by the Defence Ministry.
The ruling from the Supreme Court, which in 2012 struck down a "service deferral law", demonstrated its dissatisfaction with foot-dragging in parliament over passage of new legislation that would open the way for wider enlistment of ultra-Orthodox men.
Israel's ultra-Orthodox Jews, or "Haredim" - a Hebrew term meaning "those who tremble before God" - say the study of holy scriptures is a foundation of Jewish life and that scholars have a right to devote themselves full time to the tradition.
"The Supreme Court has declared war on us and we will wage war back on it," Haredi lawmaker Moshe Gafni told Army Radio. "He who studies Torah will continue to study Torah even if he is thrown in jail or if his funding is stopped."
Shahar Ilan, vice-president of Hiddush, one of the organisations that petitioned the Supreme Court against the exemptions, said he estimated the fund cut of about 10 million shekels ($2.8 million) would affect around 10,000 students.
Lapid said he expected a new conscription law, which is still being prepared, to be passed in the coming weeks.
"We didn't for a minute think it was going to be easy," said Lapid, whose Yesh Atid party soared on anti-religious sentiment to second place in last year's general election.
Haredim make up about 10 percent of Israel's 8 million people. They are a rapidly growing but poor section of the population. Most Haredi men are unemployed and live off donations, state benefits and their wives' often low wages.
"We feel we are being hounded by the government," Haredi lawmaker Nissim Zeev told Israel Radio.
"The court has become a tool in the hands of those petitioners who are constantly and systematically trying to uproot the foundations of the Torah."
However, Justice Minister Tzipi Livni said it was time for a change in traditional thinking.
"Part of Israel being a Jewish state means protecting the world of the seminary schools, but not a world of seminaries that provides a haven to all those who do not want to serve in the military," she told the radio. (Writing by Maayan Lubell, Editing by Jeffrey Heller and Gareth Jones)