EU officials say Israel not out of woods yet on sanctions from the bloc

If steps pledged by Israel to increase humanitarian aid for Gaza aren’t implemented by the next meeting of European Union foreign ministers in two weeks, the bloc will reconsider sanctions against Israel that were temporarily shelved earlier today, two EU officials tell The Times of Israel.

The EU will also tie its decision to the situation in the West Bank, and Brussels raised with Israeli officials a demand for Jerusalem to release tax revenues that are being withheld from the Palestinian Authority, in violation of the Oslo Accords.

The PA says that Israel is withholding roughly NIS 2.5 billion shekels ($742 million) in funds that belong to Ramallah. Israel collects customs revenues on the PA’s behalf and is supposed to transfer them to Ramallah on a monthly basis.

Israel has been withholding a portion of those funds, which it says amounts to the sum of the stipends that the PA pays to the families of security prisoners and slain terrorists. PA President Mahmoud Abbas signed a decree in February ending the policy, though Israel has been dismissive of the move.

Israel has also been withholding a portion of the tax revenues that it says amount to the sum of the funds that the PA uses to pay civil servants in Gaza, which Jerusalem claims are at risk of reaching Hamas.

Moreover, since May, when the UK issued sanctions against far-right Israeli ministers Bezalel Smotrich and Itamar Ben Gvir, Jerusalem stopped transferring the monthly customs revenues entirely, robbing the PA of roughly NIS 900 million ($267 million) in funds.

The move by Smotrich once again has the PA at risk of financial collapse, with Ramallah unable to pay its employees for June. Previous months saw PA employees only receiving a portion of their salaries due to Ramallah’s dire financial situation.

A spokesperson for one of the PA’s ministries tells The Times of Israel that many workers are not showing up to the office, as they cannot afford the cost of travel or don’t have time to wait hours at Israeli checkpoints, which have significantly hampered Palestinian transit throughout the West Bank.

An EU diplomat says Israel’s delegation indicated during this week’s high-level meeting of EU foreign ministers that Jerusalem would release some of the PA’s funds — likely the tax revenues that have been withheld since May.

However, an Israeli Foreign Ministry spokesperson denies that any commitment was made on the matter.