Abbas: Israel to Release Total Withheld Palestinian Tax Revenues

RAMALLAH, April 18, 2015 (WAFA) – President Mahmoud Abbas announced Saturday that Israel will release the total amount of Palestinian tax revenues it has withheld since last January in retaliation to the Palestinian Authority’s accession to the International Criminal Court.

Referring to Israel’s decision to release the tax revenues after payments for ‘services’ provided to the Palestinian people are deducted during March, Abbas stated the Palestinian leadership rejected the Israeli government’s decision to release the withheld Palestinian tax revenues after deducting a third of their total amount.

“The Israeli government has agreed to hand over the total amount of the tax revenues, amounting to almost half a billion dollars, and to form a joint Palestinian-Israeli committee tasked with reviewing all debts, “ said Abbas during a PLO Executive Committee’s meeting at the presidential headquarters in Ramallah.

Abbas expressed the Palestinian Authority’s willingness to accept the decision to be taken by the joint committee on paying off the PA’s debts for services.

The PA’s President added that the government would be able to fully pay public servants’ April wages.

Palestinian local media, Maannews, reported on Minister of Civil Affairs Hussein al-Sheikh as announcing that Israel will transfer the withheld tax revenues amounting to about half a billion US dollars (1.8 billion shekels) on Sunday or Monday.

Prime Minister Rami Hamdallah stated Friday that Israel pledged to release the funds during a meeting held with Palestinian officials and that an agreement has been reached over reviewing all Palestinian debts with the attendance of the joint Palestinian-Israeli committee and not by Israel’s side only.

Israeli media, Haaretz, reported that based on the understanding reached in this regard, Palestinian and Israeli officials “agreed to a major offsetting of roughly half a billion shekels that Israel withheld from tax revenues collected between December and February, meant primarily to repay debts to the Israel Electric Company.”

“Also, according to understanding reached between the two sides, Israel will significantly reduce the amount withheld from March and April tax revenues to offset the Palestinian debt. Going forward, Israeli and Palestinian representatives will continue to discuss the remaining debt as well as both sides’ obligations,” reported Haaretz.

The joint Palestinian-Israeli committee tasked with reviewing the Palestinian debts to Israel will convene in the near future to review and resolve the debt claims between the two sides.

Abbas referred to the decree he issued Friday that will see a day’s wages from all PLO and Palestinian Authority staff, both military and civilian, donated towards Yarmouk Refugee Camp, in Syria.

After being re-elected as Israel’s Prime Minister in March, Benjamin Netanyahu decided to release the tax funds after deducting payments for services provided to Palestinians, including accumulated debts for electricity, water and hospital bills.

The Palestinian Authority refused to receive the funds, arguing that the deductions made by Israel to cover services provided to the Palestinians were not ‘agreed upon’ and were decided unilaterally by the Israeli government.

The Israeli government decided to withhold around half a billion dollars in tax revenues it collects on behalf of the Palestinian Authority on imports and exports over the last four months in reprisal for the PA’s accession to the International Criminal Court (ICC) to try Israel for war crimes.

PA formally applied to join the ICC on January 2nd following the United Nations Security Council’s failure to pass a Palestinian draft resolution setting a deadline for ending the Israeli occupation and establishment of the Palestinian state.

The Israeli government’s move to freeze the transfer of Palestinian tax revenues has been widely denounced as an illegal and retaliatory move that would only serve to escalate tensions and prevent the Palestinian institutions from effectively functioning.

Israel has frequently resorted to halting the transfer of Palestinian tax revenues and exploited it as a political instrument intended to punish the Palestinians for their political choices and attempts to secure the establishment of their state through international diplomatic means.

As a result of the Israeli measure, the PA has been incapacitated from fully paying approximately 170,000 public servants on its payroll, which costs between $160 and $170 million a month.

Under the Protocol on Economic Relations signed in 1994, Israel transfers $175 to the PA each month in customs duties levied on goods destined for Palestinian markets that transit through international borders.

Acting to address the financial crisis it is gripped with, the PA has borrowed from local banks to partially pay 60% of the public servants’ December, January, February, and March wages.