Israel to Keep Holding Palestinian Authority Funds, Against Advice of Security Officials

Cabinet meeting ends with no decision on $100 million in tax revenues that were frozen by Israel after PA was admitted to UN cultural body.

Israel's cabinet met on Monday to discuss the possibility of unfreezing tax revenues to the Palestinian Authority, the transfer of which was halted after UNESCO granted the Palestinians full membership. According to sources, no decision was reached and further discussions are to take place in the coming days.

Before the meeting, officials at the finance and defense ministries estimated that the cabinet will approve the thaw of $100 million of tax funds Israel had collected for the Palestinian Authority during the month of October. However, during the meeting Defense Minister Ehud Barak and Finance Minister Yuval Steinitz could not reach an agreement on the matter.

Cabinet meeting - Flash 90 - November 13, 2011
Flash 90

The $100 million are Palestinian money which Israel collects for it under the Oslo Accords. GOC Central Command and the Shin Bet both believe that the continued withholding of the funds would hurt the salaries of Palestinian police officers, which could ultimately destabilize security arrangements in the West Bank.

Netanyahu may have decided not to bring the issue to a vote following a report he received from his envoy Yitzhak Molcho, who met with Quartet representative in Jerusalem on Monday morning. Sources in the prime minister's office said the Quartet meeting ended in disappointment after the Palestinians refused to return to the negotiating table without preconditions.

"It's unfortunate that the Palestinians continue to hold on to their old position, in an attempt to fool the international community into believing they are willing to negotiate with Israel while on the ground they continue to present preconditions," said sources in the prime minister's office.

קראו כתבה זו בעברית: למרות ההערכות: ישראל לא תעביר כספים לרשות