Palestine refuses to take deducted taxes from Israel

RAMALLAH, Palestine

The Ramallah-based Palestinian Authority (PA) on Monday reiterated its refusal to accept deducted tax revenues collected by Israel on its behalf.

“Israel is trying to legitimize the deductions from the tax revenues by all means,” President Mahmoud Abbas said during the weekly government meeting in Ramallah.

“We will not accept the deduction of a single penny from our money,” he said, describing the current financial crisis caused by the Israeli tax deductions as the “toughest”.

“The Palestinian Authority has gone through many financial crises, but this was the toughest,” he said.

Abbas said the PA has paid 50 percent of employees' salaries in the past months. “We are trying to pay 60 percent of the salaries early next month," he said.

The Palestinian leader went on to affirm that the PA is open to dialogue only “if Israel stops violation of agreements”.

Earlier Monday, Hussein Al-Sheikh, head of the PA-affiliated General Authority of Civil Affairs said on Twitter that he had a meeting with Israeli Finance Minister Moshe Kahlon to discuss developments of the financial crisis caused by Israeli deduction of Palestinian tax revenues.

"I reiterated to him [Kahlon] our absolute refusal to receive the deducted tax revenues under the policy of deductions," he said, without giving any further details.

On Sunday, the Israeli Broadcast Authority said that the PA refused to receive 660 million shekel (some $163 million) of last month's tax revenue transferred to Palestinian banks by Israel.

Israel deducts around $11 million a month on the claim that this amount is being paid out by the PA each month to the families of Palestinians imprisoned by Israel for staging attacks against Israeli targets.

Abbas has reiterated that the PA will continue to pay monthly stipends to the families of Palestinian prisoners and martyrs.

Israel collects around $175 million each month in taxes on Palestinian imports and exports on behalf of the PA, for which tax revenue represents the main source of income.

*Writing by Mahmoud Barakat