BICOM

Palestinian Authority (PA) President Mahmoud Abbas has said he will reject all tax revenue payments transferred to the PA from Israel.

Israel currently collects and transfers NIS 803,282,580 (£170m) of tax revenue to the PA every month, according to Palestinian officials. The transfer constitutes a third of the PA’s total budget.

The PA decision followed the decision by Israel’s security cabinet to deduct from the tax transfer the amount of the PA budget that is paid to persons convicted of terrorist offences and their families. The law was passed last July, but enforced now after political pressure on the Government to act after the murder of Ori Ansbacher by a Palestinian terrorist. It is estimated that half a billion shekels (around £107m) will be deducted annually from the tax transfer as a result.

In comments to a US Congressional delegation in Ramallah, Abbas said: “We refuse to receive all of the tax funds. We don’t want them. Leave them over with them.”

Abbas also spoke on Voice of Palestine, the official PA radio station and said: “I tell you honestly that if we only had 20 or 30 million shekels, which is what is paid [monthly] to families of martyrs, we will give them to the families of martyrs. I mean if the [Palestinian] Authority doesn’t have anything other than that [amount], I will pay it to the families of martyrs and prisoners and wounded persons. This needs to be understood.”

Abbas’s spokesman, Nabil Adu Rudeineh, warned Israel of “repercussions” after its decision to reduce the tax transfer.

The decision has caused concerns within Israel’s security establishment. The Israel Security Agency, the Shin Bet, has warned that the economic blow to the PA could put continued security cooperation at risk, or even result in the collapse of the PA, placing the responsibility for administrating the West Bank on the Israeli military.