Palestinian security forces stand guard while Palestinians hold a protest in Ramallah last July demanding that Palestinian Authority sanctions imposed on Hamas-ruled Gaza be removed. (Issam Rimawi/Anadolu Agency/Getty Images)

Palestinian Leaders Slam Israel For Playing ‘Tax Card’ Again

Palestinian chief negotiator Saeb Erekat says Israel intends to send the tax money it collects on the PA’s behalf directly to the Gaza Strip, effectively offsetting PA sanctions against the Hamas-ruled enclave

The Palestine Liberation Organization revealed on Monday that Israel has decided to transfer tax and tariff funds it collects on behalf of the Palestinian Authority (PA) directly to the Gaza Strip. The move would effectively offset the sanctions PA President Mahmoud Abbas imposed on the enclave in an attempt to wrest political control from Hamas, the group controlling it.

The PLO is recognized as the official voice of the Palestinian people and the dominant movement within the PA.

Last year, Abbas imposed a set of sanctions on the Gaza Strip in hope of achieving reconciliation between Fatah and Hamas. The punitive measures included cutting Gaza’s monthly allowance, including the salaries and social benefits of the PA’s Gaza-based employees.

During a recent conference in Ramallah, Saeb Erekat, the PLO’s Executive Committee secretary, stressed that Israel made clear its decision in a letter sent to the PA in recent days.

Erekat did not provide any details about Gaza’s share of the Palestinian funds—which analysts say amounts to some $130 million per month in taxes and tariffs Israel collects on behalf of the PA and then transfers to Ramallah pursuant to terms of the 1993 Oslo Accords.

“This is an aggressive step that comes as part of Israeli efforts to implement [U.S. President Donald Trump’s] ‘deal-of-the-century,’” Ziad abu-Ziad, Fatah’s international media spokesperson, told The Media Line.

Israel is working hard to divide Palestinians in Gaza from their brethren in the West Bank, he explained. Israel’s aim is to encourage the formation of separate political entities on the Palestinian side. “The decision is totally unacceptable and there will be consequences in the coming days,” Abu-Ziad warned.

Azmi Abdul Rahman, spokesman for the Ministry of Economy, explained to The Media Line that Israel’s financial maneuver would negatively impact the Palestinian economy, as well as the government’s ability to manage its expenditures.

“It’s a provocative step that violates the agreement we have with Israel and many international protocols,” Abdul Rahman added. “Israel is trying to strengthen the illegal government in Gaza [ruled by Hamas], while pressuring and weakening the legitimate one in the West Bank. And that will have serious consequences.

“Israel therefore isn’t trying to help the Strip and its people; instead it is fomenting Palestinian division,” he concluded.

Hanna Issa, a Palestinian legal adviser, told The Media Line that Israel is clearly violating the landmark Oslo agreements. The accords granted Ramallah limited self-governance in designated areas of the West Bank and Gaza Strip.

“Based on the signed agreements, Israel is violating both of them. Until the establishment of an independent Palestinian state, Israel must transfer the tax money to the PA.”

An economic analyst who spoke to The Media Line on the condition of anonymity added that Israel’s control of funding “means political power on the ground.”

“Israel’s latest tax card basically reduces Abbas’ power in the West Bank and Gaza, as Israel forges its own agreements with the armed Islamic group that rules the Strip. Its decision, however, shouldn’t affect the Palestinian economy that much, but it will felt politically,” the analyst contended.

“As far as I’m concerned, both the PA and Hamas have expired politically and it’s very important to hold elections to establish a legitimate government that could manage the funds based on a national Palestinian agenda, and not on factional politics.”

In June, hundreds of Palestinian demonstrators, many of them activists, writers and intellectuals, converged on Ramallah from all over the West Bank to protest the PA’s imposition of sanctions on the Gaza Strip. They raised banners calling on the government to end its “punishment” of the enclave and pay the outstanding salaries it owes to PA public-sector employees based in the coastal enclave. Many of these payments have been suspended for months.

The protesters also called for the resignation of many PA leaders, including members of the Fatah faction, Central Committee, the PLO’s Executive Committee, as well as the National Council, which acts as the de facto Palestinian legislature.

The factional tensions between Hamas and Fatah began in 2006, when Hamas forcibly evicted Fatah from the Gaza Strip in a political coup.

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