CAIRO

The Arab League has decried as "piracy" an Israeli decision to freeze millions of dollars in tax fees to the Palestinian Authority (PA).

"This decision is a continuation of the Israeli piracy and theft of the Palestinian people's funds and resources," the Cairo-based league said in a statement on Monday.

It said the freeze was a "clear violation and flagrant breach of international commitments", going on to call on the UN agencies to "face this new Israeli aggression".

On Sunday, the Israeli government decided to deduct NIS 502 million (US $138 million) from the funds designated for transfer to the Ramallah-based PA.

Israel argues that the amount is being paid by the PA to families of Palestinians involved in attacks against Israeli targets.

Israel collects around $175 million every month in taxes on Palestinian imports and exports on behalf the PA.

Tax revenue represents the PA's main source of income.