Israel said to seize PA tax revenue over debt dispute

Palestinian Authority official decries move as attempt to hobble Hamas-Fatah unity government

Illustrative photo of Israeli shekels. (Sophie Gordon/Flash90)
Illustrative photo of Israeli shekels. (Sophie Gordon/Flash90)

The Israeli government has been withholding over NIS 200 million ($56 million) in tax revenues from the Palestinian Authority, the Palestinian Ma’an news agency reported Monday.

The report, which quoted an unnamed senior Palestinian official, said that Israel had withheld approximately NIS 90 million ($25 million) to cover the debts of the Palestinian electric company, an additional NIS 90 million related to other Palestinian Authority debts, and NIS 30 million ($8 million) to pay for the medical bills of Palestinians who were referred to Israeli hospitals by the PA.

In accordance with the Oslo Accords of 1994, an Israeli government agency has been acting as an official tax-collecting apparatus working in conjunction with the PA to collect taxes from Palestinian residents of the West Bank.

The Palestinian Authority, which relies heavily on civil services provided by Israel, has long had an outstanding multimillion-dollar debt with the Jewish state.

According to the official, Israel only transferred NIS 380 million ($106 million) to the Palestinians, which, he said, is only enough to cover 40 percent of the salaries of government workers in the West Bank.

The move comes after an announcement on Saturday that the Fatah-led PA would begin paying the salaries of Hamas officials in Gaza, which have been delayed for months. According to Ma’an, Israel’s move to withhold the funds would likely jeopardize the PA’s ability to pay the salaries of civil servants in Gaza.

The official derided the move as an attempt to create obstacles for the Palestinian unity government, which brought together longtime rivals Hamas and Fatah in a pact signed in April.

The Israeli government’s refusal to transfer the money also comes after a PA minister declared on Sunday that the budget for the unity government was “below zero.”

The cost of the salaries of Palestinian Authority civil servants is estimated at $200 million per month, with Israel providing $120 million with tax money collected on behalf of the PA.

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