Smotrich said refusing to approve economic measures to assist Palestinian Authority

Far-right finance minister’s opposition may prevent Israel from fulfilling promise made to US government

Finance Minister Bezalel Smotrich takes part in a march to the illegal West Bank outpost of Evyatar, near the West Bank city of Nablus, during the Passover holiday, April 10, 2023. (Sraya Diamant/ Flash90/ File)
Finance Minister Bezalel Smotrich takes part in a march to the illegal West Bank outpost of Evyatar, near the West Bank city of Nablus, during the Passover holiday, April 10, 2023. (Sraya Diamant/ Flash90/ File)

Finance Minister Bezalel Smotrich is refusing to sign off on economic measures to prop up the Palestinian Authority, despite Israeli commitments to the US, according to a Monday report.

Channel 12 said the Religious Zionism chairman is adamant in his opposition to an Israeli agreement to delay the payment of PA tax debts, which total approximately $500 million. The report added that the finance minister will likely refuse to approve any other move intended to assist the PA.

On Sunday, the security cabinet debated a series of measures meant to prop up the PA, formulated by National Security Adviser Tzachi Hanegbi and the head of the Coordinator of Government Activities in the Territories, Ghassan Alian. However, the ministers planned announcing the moves at a later date, due to their proximity to Saturday’s terror attack in Tel Aviv, in which municipal security officer Chen Amir was killed.

According to Channel 13 news, Strategic Affairs Minister Ron Dermer told the cabinet that the measures to aid the PA are part of promises made to the US administration in the wake of recent settlement construction in the West Bank. Prime Minister Benjamin Netanyahu reportedly echoed that “promises must be kept — in particular to the Americans.”

Smotrich’s refusal to sign off on the moves would break such a promise.

A security official told Channel 12 the minister’s position was untenable.

“There’s no turning back,” the unnamed source said. “This is a clear commitment to the American government. The finance minister does not control and will not control this government.”

Kan reported that Smotrich and National Security Minister Itamar Ben Gvir clashed with Netanyahu and Defense Minister Yoav Gallant over several of the measures, which also include the cancellation of a previous decision to redirect funds from tax revenue Israel collects on behalf of the PA to families of Israeli terror victims.

Ben Gvir reportedly fumed over the timing of the measures, complaining that “you talk about [the Palestinian Authority] as terror supporters, why would you now grant them relief measures?” In response, Netanyahu reportedly said it was in Israel’s best security interest “to stabilize” the situation and prevent the collapse of the PA.

Last month, the security cabinet voted in favor of a series of steps to bolster the PA, including the approval of a new industrial zone in Tarqumiyah, near the southern West Bank city of Hebron, a move long supported by Israeli security officials, and the extension of hours at the Allenby border crossing with Jordan.

Further measures included the restoration of VIP permits for senior PA officials. The permits were canceled by the government in January in response to the UN General Assembly’s approval of a resolution, promoted by the Palestinians, requesting that the International Court of Justice weigh in on the conflict.

At the same time, it remains unclear whether there has been real movement to implement the policies or whether they were mostly declaratory.

In January, Smotrich signed a decree to redirect NIS 139 million ($39.6 million) in PA tax revenue, as part of punitive measures against the PA’s international legal action against Israel.

Israel has made such deductions in the past, following 2018 legislation on the matter, but only partially upholds the policy, as officials are keenly aware that the PA is dangerously close to financial collapse.

The PA told Israel recently that it would not attend the next regional security summit if the cabinet rejects the proposal, Kan reported Sunday. Israel, the PA, Jordan, Egypt, and the US convened in two such summits in February and March, and have been discussing bringing the sides together again.

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