BICOM

A Hamas appointed court this week ordered two major banks in Gaza to pay millions of dollars in back fees and fines for refusing to accept the tax laws of the Hamas government. Bank officials, did not attend the court hearing, but said that a lower court’s decision earlier this week may force them to shut down the banks temporarily. The ruling on the banks was not publicly available, but sources involved in the process said the Bank of Palestine was ordered to pay £72 million in taxes and fines. The decision also banned 11 members of the bank’s board of directors from leaving Gaza.

The bank dispute stems from the 2007 split between Hamas and the PA. Since then, although it has refused to recognise the Hamas government, the PA has continued to pay salaries to tens of thousands of people to stay home from their ministries and state agencies in Gaza. In their places, Hamas, however, have appointed new employees, including judges of the courts. Abbas also ordered all banks and private companies in Gaza to stop paying fees to the Hamas government.

A PA official in Ramallah, speaking to The Associated Press, said the ruling threatened the stability of Gaza’s banking system. He added that once there was a unity government and a functioning Palestinian Parliament again, the tax situation would most likely be rectified. However, it remains unclear how much progress can be made given the tensions between the two factions.