IDF, Shin Bet, Gantz balked at seizing PA taxes over terror stipends — report

Even though decision eventually passed, security officials warned that now is a bad time to deal a financial blow to PA, according to Walla

Defense Minister Benny Gantz attends a conference in the Eshkol region, southern Israel, on July 13, 2021. (Flash90)
Defense Minister Benny Gantz attends a conference in the Eshkol region, southern Israel, on July 13, 2021. (Flash90)

Defense Minister Benny Gantz, Transportation Minister Merav Michaeli, and Health Minister Nitzan Horowitz all had reservations about a security cabinet decision to withhold hundreds of millions of shekels from the Palestinian Authority to offset funds that it paid to terrorists and their families, the Walla news website reported Tuesday.

The report said the ministers’ positions were in line with those of the military and the Shin Bet.

The Security Cabinet eventually decided on Sunday to seize nearly NIS 600 million ($183 million) from the PA over funds it paid out over the past year.

The three ministers were reportedly concerned about the timing of the move due to the financial strife the Palestinian Authority is already facing.

The website cited two unnamed senior officials familiar with events at the cabinet meeting, who said that the military’s chief liaison to the Palestinians, Coordinator of Government Activities in the Territories (COGAT) Major-General Ghassan Alian, cautioned against withholding the taxes, reporting to ministers that a similar offset from 2019 had not yet been completed.

The PA needs the cash and taking both the 2019 and 2020 taxes would be a heavy, though not knockout, blow for the Authority, Alian explained. Shin Bet representatives backed up Alian’s position and his concerns, proposing that the action be put off until a later date, Walla reported.

The Blue and White party’s Gantz backed the COGAT chief’s position and also expressed support for a postponement. Michaeli, of the Labor party, and Horowitz, of Meretz also supported a delay, pointing out that weakening the PA is against Israel’s interests.

Head of the Meretz party Health Minister Nitzan Horowitz, left leads a Meretz faction meeting at the Knesset, in Jerusalem, on July 12, 2021. (Olivier Fitoussi/Flash90)

Later during the meeting, Israel Defense Forces representatives presented policy regarding the Gaza Strip, which is ruled by the Hamas terror group.

A suggestion was made for methods to weaken Hamas, which is committed to Israel’s destruction, in favor of the PA, with which Israel has cooperation agreements. Michael and Horowitz then pointed out that the suggested policy was in contradiction to the plan to withhold the taxes, which would weaken the PA.

According to the report, the discussion on withholding PA taxes lasted only several minutes and was not heated, though it represented the first time that coalition partners have disagreed on policy towards the Palestinians since the new government was formed last month.

Amid political turmoil, Israel was under a transitional government until June, when the new coalition was confirmed.

Labor party leader Transportation Minister Merav Michaeli attends a faction meeting at the Knesset, in Jerusalem, on July 12, 2021. (Olivier Fitoussi/Flash90)

According to a report presented Sunday to the security cabinet by Gantz, prepared by the Defense Ministry’s National Bureau for Counter Terror Financing, the Palestinian Authority transferred NIS 597 million ($182 million) in “indirect support for terror in 2020.”

“In light of this report, these funds will be frozen from the monthly payments that Israel transfers to the PA,” the Prime Minister’s Office said in a statement.

It is not the first time the security cabinet has withheld some tax funds that it collects for the Palestinian Authority to penalize it for payments to imprisoned terrorists and the families of dead attackers.

In November, the cabinet voted to hold back approximately NIS 600 million ($183 million) out of a transfer of around NIS 2.4 billion ($731 million) over the so-called “pay to slay” payments.

Palestinian officials have indicated over the past year that they are considering reforming the controversial PA policy of paying salaries to Palestinians convicted by Israel of security offenses and terrorism.

The prisoner issue has long hampered the PA’s diplomatic efforts in Washington, and Israel has repeatedly invoked the terror funding to criticize Ramallah in international forums.

The administration of United States President Joe Biden, who took office in January, has repeatedly urged the PA to halt its policy of “providing compensation for individuals in prison for acts of terrorism.”

But just a month ago, PA President Mahmoud Abbas reportedly approved a payment of more than $40,000 to the family of Muhannad Halabi, who killed two Israelis in a 2015 stabbing attack in Jerusalem and was then shot dead by security forces.

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