Palestinians agree to accept tax money from Israel, easing financial crisis

The Palestinians will accept millions in tax funds collected by Israel on their behalf, for the first time since May, according to a Palestinian official.

The announcement came days after the Palestinians agreed to resume security cooperation after six months.

“Today I held a meeting with the Israeli side. We emphasized that the bilateral agreements signed, which are based on international legitimacy, are what governs this relationship,” says PA liaison with Israel Hussein al-Sheikh, according to the official Wafa news agency.

“It was agreed to transfer all financial dues to the PA, and we rejected the settlement policy, demolishing homes and lands confiscation. It was agreed to hold another meeting soon.”

The so-called “clearance revenues” constitute around 60 percent of the PA’s budget. Ramallah had ceased accepting the tax transfers from Israel in late May in protest of its West Bank annexation plans. Without the tax money, the PA suffered an acute financial crisis. The Authority has not paid its employees full salaries for months. Public sector salaries constitute around 20% of the West Bank’s GDP. Without them, many West Bank residents struggled to get by.