I have always been under the impression that one is required to prioritize buying from a religious Jew over a
non-Jew, even if the cost is higher, by up to a sixth. Is this indeed correct? Where can I find it?
The source for the ruling that one should prefer buying from and selling to a Jew is a Toras Kohanim which is cited by Rashi (Vayikro 25, 14) that deduces this ruling from the expression used by the pasuk in describing the sale of an item. The Malbim (Behar 29) explains how the terminology used by the Torah implies that this is a required practice and not merely good advice. We note that the word used by the pasuk in describing the Jewish seller is amisecho which the Gemara (Shavu’os 30A) explicitly states means a Jew who adheres to the Torah. Therefore, when we mention Jew in this context we refer to an observant Jew, a point which is stressed by Rav Moshe Sternbuch in his rulings that we quote below.
While the Sefer Hachinuch (Mitzva 337) cites this ruling, the Rambam and Shulchan Aruch do not mention it and it is not brought in the Gemara.
The basic source for the applicability of this ruling is a responsum of the Rama (res. 10). The question concerned an edition of the Rambam that was published by a wealthy non-Jewish printer. The non-Jew had wanted to partner with one of the gedolei hador, the Maharam Padua. The Maharam refused and published a corrected version of the Rambam by himself. The wealthy gentile decided to get even with the Maharam and he published the Rambam himself and announced that he would undercut the Maharam’s price by one gold coin, which he could afford to do since he was so very wealthy. One gold coin was a very significant amount as we can see from the Ramo’s comment that no one would spend an extra gold coin to buy the Maharam’s printing. The Maharam could not afford to lower his price and was faced with a tremendous loss since he had invested much time and money in order to print a corrected version. The Rama issued a nidui-excommunication, on any Jew in the world who purchases the gentile’s edition before the Maharam completes the sale of his edition. The Rama based his ruling on four reasons, the third of which was the Toras Kohanim mentioned above that one must prefer buying from a Jew.
Since the Toras Kohanim never says that one is required to spend more money in order to buy from a Jew, which was the issue in his case, the Ramo set out to prove his contention that one is required to patronize Jewish enterprises even if means paying a higher price. We will study the Ramo’s proof since it is relevant to your question.
The Ramo first attempted to prove his contention from a section of the Gemara (BM 71A) that derives from a pasuk that one must prefer lending money to a Jew. The Gemara asks that this is obvious since there is no mitzvah to lend money to a non-Jew at all while there is a mitzvah to lend to a Jew. The Gemara answers that the pasuk teaches that even if the choices are lending to a gentile with interest and granting the Jew an interest-free loan, one must prefer the Jew. Thus we see that one must prefer a Jew even at the cost of a loss of income.
However, the Ramo was not satisfied with his proof because perhaps one only has to bear a loss of income but not a loss of money that one already owns. To prove that one must actually suffer a loss, he cites a second Gemara (Avoda Zoro 20A) that derives from a pasuk that one should give an unslaughtered carcass for free to a Ger Toshav (one who accepted to abide by the seven Noachide laws but may eat unslaughtered meat) even if he could sell it to a gentile. Since in this case the Jew is required to give away for free a carcass that has value to him (since he could sell it to a gentile) we see that one must prefer a Jew even if it results in an actual monetary loss.
From this responsum we learn that the Ramo maintained that even though the law that one should prefer Jewish sellers is not brought by the Gemara, Rambam and SA, nevertheless it is mandatory. Moreover, although the Ramo does not give an upper limit on the amount one must lose in order to fulfill this law, it certainly is a significant amount since the Ramo said that if not for his edict everyone would have bought the gentile’s edition of the Rambam and that was in spite of the fact that the Maharam’s version was the corrected version and the gentile’s was, for the most part, not corrected.
Another early source that one must prefer Jews even if it means suffering a loss is the Tashbatz (3, 151) who argues that if the price is the same one would not need a pasuk since then it is obvious that one should prefer a Jew, an argument that was given by the Gemara (BM 71A), as cited earlier. Like the Ramo he does not cite an amount and does not even say that the law applies even if the difference in price is significant.
A third significant source is the Chikrei Lev (CM 139) who also notes that the Ramo ruled that one must prefer a Jew even if the price disparity is significant and he suggests a source for this ruling. However, he raises a strong question from a ruling of Tosafos (BM 108B), and the Rosh (BM 9, 28) which is ruled by the SA (175, 41) that one may sell his field to a gentile if there is no Jew who is willing to match the gentile’s price which seems to run counter to the entire Toras Cohanim.
He suggests that perhaps these commentaries are only discussing the issue of the requirement to sell to a neighbor (bar metsro) but agree that there is another mitzvah to prefer a Jew even if the Jew does not fully match the gentile’s price. The Chafetz Chaim cited later also answers this way.
Even though we saw that the Ramo ruled that one must patronize a Jew even if his price is significantly higher, there are several indications that one does not need to prefer a Jew if the price difference is in some sense significant.
As we noted earlier, the Ramo cited two sections of the Gemara as his sources. Therefore, one should be able to decide if the halocho applies even when the price difference is significant by examining the Ramo’s sources. In the case of a carcass, Tosafos (Avoda Zoro 20A) asks on the Gemara that the entire ruling that one should give the carcass as a present to a ger toshav and not sell it to a gentile is strange because by the same reasoning one should give everything as a present to a ger and never sell to a gentile. Therefore, Tosafos says that the Torah only ruled this way in the case of a carcass where the gentile would only pay a small amount. In that case the Torah says to absorb a small loss and give it as a present to a ger.
According to this, the Ramo’s source only proves that one must absorb a small loss and not, as the Ramo contended, even a significant loss.
Similarly, the second source of the Ramo, that one should lend his money interest-free to a Jew and not lend for interest to a gentile, also is limited by many poskim to a situation where the loss of interest is not large (like it was until recently where one received only about one percent in money markets). However, if the loss is significant the Sha’ar Mishpot (97, 1) applies Tosafos’ ruling that one need not lend without interest to a Jew who is not poor, at the expense of earning interest from a loan to a gentile. The Sha’ar Mishpot understands that the pasuk is referring to a Jew who is not poor.
Rav Moshe Feinstein (YD 3, 93) similarly rules that one must forego interest in order to lend to a poor Jew only if the loss of interest is not major. He differs from the Sha’ar Mishpot who limited his ruling to a non-poor Jew. He adds that the amount of interest one foregoes by lending to a poor person can be claimed as a ma’aseir expense.
Earlier, the To’afos Re’em (Tobias OC 22) raised the questions on the Ramo and maintained that one must only patronize Jews if the price difference is not significant.
Thus we have several sources that indicate, unlike the Ramo, that one must patronize Jews only if the price difference is not significant. We will now examine the rulings of recent poskim.
The Chafetz Chaim (Ahavas Chesed 5, 7) explicitly rules that one must only pay a little more and he understands that the Ramo agrees. The Minchas Yitzchok (3, 129) who was asked precisely this question, says that if we maintain that the law applies only if the difference in price is not significant, perhaps the cut-off point is one sixth (as you thought) since we find in YD that if there is a loss of that size, some poskim maintain that it is categorized as a major loss. However, he is not certain. He adds that if a Jewish seller is overpricing according to the Gemara’s (BB 89-91) standards, then he is not entitled to preferential treatment.
Rav Moshe Sternbuch discusses the issue twice. In his first responsum (1, 805) he assumes that one must patronize Jews if the difference is up to one sixth. He cites no source for this. He questions why otherwise frum Jews are not scrupulous to abide by this ruling. He says that some are lenient with the argument that the Torah’s ruling applies only if the seller does not have a high income, but if the storeowner anyway earns a good living why should the customer need to spend money to help the storeowner live more comfortably. However, he is not very happy with this leniency.
He makes an additional point which is very pertinent. Often, the closest store belongs to an irreligious Jew but there is a store owned by a frum Jew a bit further away. He tells over that when the Chazon Ish needed medicine he would ask his helper to walk to the frum-owned store even though it was further away. He remains with a doubt as to how far one must walk, suggesting perhaps a mil (about a kilometer).
In his second responsum (2, 724) he notes that today many orders are placed over the phone and then definitely one should give preference to a frum-owned establishment if the price is within the guidelines we have discussed.
In conclusion: One definitely should prefer a frum-owned store. If the price difference is significant one is not obligated to buy from the frum store. Some suggest a difference of a sixth but that is not clear.