In Gaza, new taxes and price hikes foment discontent
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Analysis

In Gaza, new taxes and price hikes foment discontent

Hamas dogged as much by high unemployment as by tensions with rival groups and frustrations over delayed reconstruction

Avi Issacharoff

Avi Issacharoff, The Times of Israel's Middle East analyst, fills the same role for Walla, the leading portal in Israel. He is also a guest commentator on many different radio shows and current affairs programs on television. Until 2012, he was a reporter and commentator on Arab affairs for the Haaretz newspaper. He also lectures on modern Palestinian history at Tel Aviv University, and is currently writing a script for an action-drama series for the Israeli satellite Television "YES." Born in Jerusalem, he graduated cum laude from Ben Gurion University with a B.A. in Middle Eastern studies and then earned his M.A. from Tel Aviv University on the same subject, also cum laude. A fluent Arabic speaker, Avi was the Middle East Affairs correspondent for Israeli Public Radio covering the Israeli-Palestinian conflict, the war in Iraq and the Arab countries between the years 2003-2006. Avi directed and edited short documentary films on Israeli television programs dealing with the Middle East. In 2002 he won the "best reporter" award for the "Israel Radio” for his coverage of the second intifada. In 2004, together with Amos Harel, he wrote "The Seventh War - How we won and why we lost the war with the Palestinians." A year later the book won an award from the Institute for Strategic Studies for containing the best research on security affairs in Israel. In 2008, Issacharoff and Harel published their second book, entitled "34 Days - The Story of the Second Lebanon War," which won the same prize.

A truck loaded with goods enters the Gaza Strip from Israel through the Kerem Shalom crossing in  the southern Gaza Strip, March 15, 2015. (Abed Rahim Khatib/Flash90)
A truck loaded with goods enters the Gaza Strip from Israel through the Kerem Shalom crossing in the southern Gaza Strip, March 15, 2015. (Abed Rahim Khatib/Flash90)

The Hamas government in the Gaza Strip has instituted new taxes that will be used to pay the salaries of its administration officials, who number approximately 40,000.

Hamas, which declared the taxes under the heading “social solidarity,” decided to begin collecting them following a meeting of its parliament members who live in Gaza.

The new taxes, which include a 25 percent tariff on new cars, have led to higher prices, such as a 20% increase in the price of beef.

Commentators in Gaza say that the public is very frustrated with and disappointed in Hamas, mainly over its failure to rebuild the Strip.

The new taxes are also constantly changing. One tax that was instituted recently requires companies registered with the Economic Affairs Ministry in Gaza to pay approximately NIS 500 to have a Hamas representative participate in a company conference. Hamas charges another few hundred shekels to have the conference registered, and if it is postponed, the postponement is taxed as well.

The most problematic taxes are levied on all goods that enter the Gaza Strip through the Kerem Shalom border crossing. Even cartons of cigarettes that are brought in from the West Bank are taxed. This means that the average resident of Gaza pays more for cigarettes than his counterpart in the West Bank does, even though the standard of living in the West Bank is higher.

Another example is meat: Since importers must pay NIS 50 in taxes for every calf that enters Gaza, the price of beef has gone up. Hamas’s import tax on sheep is “only” NIS 25 per head.

But Hamas’s problems do not stop there. The reconstruction of the thousands of buildings destroyed during last summer’s war with Israel has yet to begin; so far, only those buildings that were damaged are being repaired.

As if the dire economic situation, which has resulted in a particularly high unemployment rate of 44%, weren’t enough, tensions between Hamas and the Salafist groups in the Gaza Strip have intensified in recent weeks. A Salafist activist was killed Tuesday when Hamas members came to arrest him for suspected involvement in bombings that had taken place in Gaza.

The Salafist groups, including some that claim to be the Palestinian branch of Islamic State, or Ansar Bait al-Maqdis, have given Hamas an ultimatum: either release dozens of their members whom Hamas imprisoned recently or face attacks.

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