Arab League to Aid Palestinian Authority After Israel Withholds Tax Money

The move is meant to counter an Israeli decision to deduct 500 million shekels from Palestinian tax revenues

Tunisian President Beji Caid Essebsi chairs the 30th Arab League summit in Tunis on March 31, 2019.
AFP

The Arab League announced Sunday that they will supply the Palestinian Authority with a financial safety net in response to an Israeli law that takes massive deductions from Palestinian tax revenues.

The announcement was made during the closing statements of the Arab League summit in Tunis, Tunisia.

Arab leaders papered over long-running regional rivalries on Sunday to condemn a U.S. move to recognize Israel's sovereignty over the Golan Heights and said stability in the Middle East hinged on creating a Palestinian state.

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The Palestinian Liberation Organization issued a statement in response thanking the Arab league for helping "Palestine overcome the debilitating financial strains caused by Israel's illegal piracy of Palestinian tax revenues."

The PLO thanked the Arab League for "rejecting the illegal policies of the Trump Administration regarding occupied Jerusalem and the Syrian Golan Heights" as well as their "rejection of Israel's illegal actions."

The statement further echoed comments made by Palestinian President Mahmoud Abbas at the summit, claiming that the U.S. emboldens Israel's "racist policies." The statement reiterated that "irresponsible U.S. policies and actions have encouraged the Israeli political establishment, which is overrun by rightwing, racist, and hostile actors, to exercise unchecked violence against the Palestinian people."

In February, the Israeli government decided to deduct 500 million shekels ($138.2 million) from taxes that would otherwise be transferred to the PA. Israel announced the deduction to offset an equivalent sum paid by the Palestinian Authority to Palestinian terrorists in Israeli prisons, their families and released prisoners.

After Israel decided to freeze the funds, the PA refused to accept the partial transfer of tax revenues from Israel. "Either we get all our money and rights, or we won't get anything. If they deduct some of it, they can deduct all of it," Abbas said.

Under the 1994 Paris Protocol, which established a customs union between Israel and the Palestinian Authority, Israel is supposed to collect value-added tax, import duties and other taxes on the PA's behalf and hand them over on a monthly basis.

Israel controls all international crossings, meaning the PA cannot have any independent import or export arrangements. Withholding funds contravenes the Paris Protocol.