Israel can either have a death penalty or not have one, but they need to pick a lane here. I don't particularly like this splitting of hairs between those convicted of murder in any other instance besides some animus towards Israelis as a whole, and those murderers who do. Whether the proposed law is racist, I'm not really sure it is on its surface (de jure), but it can effectively be used as one (de facto), depending on how a prosecutor wants to frame his argument.
Me, I would believe that nearly any murder beyond some crime of passion constitutes some danger to the society (i.e. all of Israel) as a whole. In which case in keeping with Israeli tradition that would mean "nationalistic" murders would not have the death penalty imposed upon them either.