11/6/2024–|Last updated: 11/6/202404:52 PM (Mecca time)
Israeli Finance Minister Bezalel Smotrich ordered the deduction of $35 million from Palestinian tax funds (clearance), and transferring it to Israeli families who claim that members of them were killed in attacks carried out by Palestinians, according to Hebrew media.
The newspaper “Israel Hayom” said that Smotrich ordered – yesterday, Monday – the Tax Authority to “deduct the amount of 130 million shekels (about 35 million dollars) from the tax funds of the Palestinian Authority, and transfer it to 28 Israeli families, whose members it says were killed in Palestinian attacks.”
She added, “Through this decision, Smotrich allows for the retroactive application of dozens of legal provisions that have remained dead (inactive) for many years, some of them for 20 years.”
The newspaper indicated that some amounts “reach millions and will be transferred to each family in the coming days.”
She considered that Smotrich’s decision was motivated by “the Palestinian Authority’s refusal to pay compensation to the families (whose members were allegedly killed) even though the courts in Israel ordered it to do so.”
The newspaper quoted the Israeli Ministry of Finance as saying that Smotrich’s decision opens a “green path” to confiscate the Palestinian Authority’s funds, which may lead to a wave of new lawsuits against it.
A stifling financial crisis
This decision is the latest in a series of decisions taken by Smotrich over the past months, which plunged the Palestinian Authority into a stifling financial crisis.
The Palestinian Authority did not immediately comment on the decision, but it usually describes Israeli measures as “piracy.”
On May 23, the World Bank warned that “the public financial situation of the Palestinian Authority has deteriorated sharply in the past three months, which significantly increases the risk of a collapse in public finances.”
Clearance funds are taxes paid by Palestinians on goods imported from Israel or through Israeli border crossings, with a monthly average of $220 million.
The Palestinian government mainly uses clearing funds to pay the salaries of public employees, and they constitute 65% of the total financial revenues of the Palestinian Authority.
However, as of 2019, Israel decided to deduct an amount of 600 million shekels ($165 million) annually from the clearance funds, in exchange for the monthly allocations provided by the Palestinian Authority to prisoners and liberated prisoners.
The annual figure for this deduction related to allocations for prisoners and released prisoners increased to an average of 700 million shekels annually ($195 million).
Since November 2021, the Palestinian Authority has not been able to pay the salaries of public sector employees in full proportions, but rather in proportions ranging between 50-90% of monthly salaries.
The Israeli General Security Service, Shin Bet, had previously warned of the “collapse” of the Palestinian Authority if the financial crisis continued, but Smotrich repeatedly stressed his determination to detain and deduct Palestinian funds, as one of the repercussions of the war on the Gaza Strip.
