Israel Freezes Transfer of 500 Million Shekels of Palestinian Authority Taxes

Israeli security cabinet puts into effect legislation from July calling to halt transfer of funds that Israeli defense officials believe are delivered to terrorists

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Palestinian president Mahmoud Abbas attending a joint press conference following their meeting in the West Bank city of Ramallah on February 5, 2019.
Palestinian president Mahmoud Abbas attending a joint press conference following their meeting in the West Bank city of Ramallah on February 5, 2019.Credit: AFP

The Israeli defense cabinet decided to put into effect on Sunday a law calling to freeze funds transferred to the Palestinian Authority as well as to deduct 500,000,000 shekels (138, 222,500 dollars) from the total sum that is due to be delivered.

The law to freeze the funds was passed by the Israeli parliament in July 2018.

According to data presented by defense officials, in 2018 the PA had transferred the aforementioned sum provided by Israel to terrorists who were detained in Israel as well as to their families and to released prisoners.

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Therefore, Israel decided to freeze the same amount from the total sum of tax money it charges and collects on behalf of the PA.

Prime Minister Benjamin Netanyahu, who also acts as defense minister, instructed defense officials to look further into additional payments the PA provides to terrorists and their families. Should the sums be updated, the amount of money withheld will also increase accordingly.

The law stipulates that every year the defense minister will submit to the security cabinet a report summarizing the transfer of funds from the PA to prisoners and their families. This sum will be divided by 12, and the result will be withheld from the subsequent monthly transfers of taxes Israel makes to the PA.

The freezing of tax money is a method Israel uses many times as sanctions against the Palestinians. In this instance, the transfer of the funds goes against the Oslo Accords and violates a unified tax policy Israelis and Palestinians have agreed upon. In all previous cases in which Israel took this step, it walked back on the move following understandings it reached with the Palestinians.

Palestinian President Mahmoud Abbas denounced the Israeli move later Sunday. A statement from his bureau read: "We strongly condemn any deduction of Palestinians’ money. This a robbery of the Palestinian people.”

Presidential spokesman Nabil Abu Rudeineh released an additional statement: "The Palestinian president's stance is that the Palestinian leadership will not agree to any moves against the money of the hero prisoners and the families of those killed or wounded.”

Abu Rudeineh added the Israeli decision is “a unilateral move that harms the signed agreements between Israel and the Palestinian Authority.” He said it would have “severe ramifications on all fronts,” adding the Palestinian leadership will discuss its consequences in the upcoming days.

Israel's Ambassador to the UN Danny Danon responded to the move later Sunday evening, stating: "No country in the world should fund despicable murderers who have killed its people. The blood money the Palestinian Authority gives to terrorists symbolizes the culture of terror and incitement. We will continue to act in accordance with the international community against the financial industry that funds murderers and encourages additional terror attacks."

The new Israeli legislation was met with harsh response from Palestinian officials. Speaking to Voice of Palestine radio, Issa Qaraqe, head of the Prisoners' Commission, said at the time that the funding freeze is "theft and piracy of Palestinian money as well as an arbitrary and racist law."

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