Sometimes you have to think about broad impact when developing policy. Sure, laws against rain collection seem draconian on the individual scale, but if a large percentage of the population collected rainwater, reservoirs and water tables can be seriously affected. Not saying this specific Israeli action is justified, but there are valid limitations on water collection put in place to ensure everyone has access.
It would be substantially worse if there were no such limitations in place, and whoever owned the land that drained into communal reservoirs could privately control the water supply of a region.