A senior Palestinian official on Monday lambasted the decision by Israel’s security cabinet to withhold tens of millions of dollars’ worth of tax revenues from the Palestinian Authority over Ramallah’s payment of stipends to attackers and their families.
“This is another step of escalation designed to impose a financial blockade on us,” PA Civil Affairs Minister Hussein al-Sheikh said in a statement.
“We will continue to pay salaries to the martyrs and families of the wounded no matter the cost,” he asserted, adding that the PA was considering steps to take in response to the move from Jerusalem.
Israel said on Sunday it would withhold around NIS 149 million (just over $43 million) from the tax funds that it collects on the PA’s behalf.
The figure is based on the estimate of the amount Ramallah has paid out to Palestinians killed or injured while engaged in terror activities in 2018, and is a supplement to the NIS 500 million ($144,578,030) Israel has already withheld over the course of the past year.
A defense source told The Times of Israel that the government would begin discussion the withholding of tax funds based on the PA’s 2019 terror payments sometime in the beginning of the new year.
While a law passed in July 2018 called for the withholding of an amount equal to payments to both prisoners and the families of slain attackers, it was only partially implemented in 2019 to cover the payments to prisoners, leading to pushback from the right.
Ahead of the security cabinet vote, Shin Bet chief Nadav Argaman warned the ministers present that the move risked causing unrest in the West Bank, Channel 13 reported.
Argaman recognized that recent legislation passed by the Knesset required the withholding of the tax revenues, but urged the ministers to consider what kind of relationship they want to have with the PA and how it will be impacted by the move.
Sunday’s decision comes not long after the PA agreed in October to resume accepting taxes collected by Israel following months of declining them in protest over Jerusalem withholding money over Ramallah’s payments to attackers.
Ramallah had refused to accept any tax revenues because Israel was withholding part of the sum, but retreated in the face of a burgeoning economic crisis in the West Bank.
As of October, the tax revenue transfers amounted to some NIS 600 million (about $170 million) a month — a key source of financing for the PA.
Israel says the so-called Martyrs’ Fund rewards and encourages violence, while the Palestinians say it is a way to provide for needy families affected by the decades-old conflict.
But while Jerusalem has been tough on the PA — whose President Mahmoud Abbas is a proponent of the two-state solution and, alongside paying perpetrators of attacks, has urged against violence — it has been working aggressively in recent weeks to achieve a ceasefire deal with the Hamas terror group in the Gaza Strip
National Security Adviser Meir Ben Shabbat introduced a ceasefire proposal to the security cabinet on Sunday and the ministers are expected to vote on the matter later this week.
Among the Israeli concessions to be discussed will be an agreement to boost the number of permits granted to Gazans to enter Israel for trade purposes, an additional widening of the allowed fishing zone off the Strip’s coast, advancing construction of a natural gas pipeline and increased medical assistance and equipment for hospitals. Also under consideration are new permits for Gaza workers to enter Israel, though the Shin Bet security service was said to oppose such action.
Hamas, in exchange, would increase its efforts to stop rocket fire from Gaza and rein in border protests, though Israeli military officials doubt the terror group will be able to completely control the demonstrations and rocket attacks.