PM Hamdallah: PA to Refer Israel’s Freeze of Tax Revenues to ICC

RAMALLAH, April 8, 2015 (WAFA) – Prime Minister Rami Hamdallah Wednesday said the Palestinian Authority was mulling to refer the issue of its withheld tax revenues, now frozen by Israel for fourth months, to the International Criminal Court (ICC).

During an event on counter-corruption in Ramallah, Hamdallah said the government has so far dispatched four letters of protest to Israel, regarding the latter’s “illegal deduction” of some 1.05 billion shekels (about $267 million) from the tax revenues it had returned to the PA last week. PA returned the revenue and insisted that Israel returns the amount in full and refrain from unilateral deductions without the consent of PA.

Hamdallah, upon the instruction of President Mahmoud Abbas, demanded the creation of an international body to look into these deductions, and to refer the issue to the United Nations Commission on International Trade Law in case Israel persists on its position.

Since January 2015, Israel has been withholding about $600 million in tax revenues collected on behalf of the PA.  The move was in response to PA’s accession to the ICC, through which PA can sue Israel for war crimes committed in the Gaza Strip during the 2014 summer aggression.

Under the Protocol on Economic Relations signed in 1994, Israel transfers $127 million to PA each month in customs duties levied on goods destined for Palestinian markets that transit through international borders.

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