Palestinian Prime Minister Rami Hamdallah called on Tuesday upon the United States to pressure the Israeli government to release the $130 million in tax revenues it collects on behalf of the Palestinian Authority.
Hamdallah’s remarks came as he met with the White House Coordinator for the Middle East and North Africa, Philip Gordon, in the Prime Minister's office in Ramallah, according to the Palestinian News Agency WAFA.
He said that Israel’s withholding of PA's tax revenues has hindered the PA’s ability to pay wages and pensions for around 150,000 public employees.
On January 4, Israel decided to halt the transfer of around half a billion shekels ($127.6 million) in tax revenues collected on behalf of the Palestinian Authority, in response to the latter's attempt to join the International Criminal Court (ICC).
Acceding to the ICC came following the United Nations Security Council (UNSC)'s failure to approve a Palestinian draft resolution calling for the end of Israeli occupation and the establishment of a Palestinian statehood within three years.
Israel also halted the same amount payable to the PA for the month of February.
The PA said it had no choice but to seek a loan from local banks to cover only 60% of the civil servants monthly payroll for January and February, leaving the remainder a debt on its treasury.
On January 2015, Palestinian President Mahmoud Abbas, speaking during an Arab foreign ministers meeting at the Arab League headquarters in Cairo, Egypt, asked the Arab League to provide a 'safety net' of $100 million a month to cover tax revenues withheld by Israel in retaliation for his attempt to join the International Criminal Court, reported media outlets quoted by WAFA.
On February 14, President Mahmoud Abbas last Friday warned that the Palestinian Authority (PA) would take harsh steps if Israel continues to illegally withhold the tax revenues it collects on behalf of the PA.
"There is a serious issue; Israel is withholding our money [tax revenues], which entails putting the Palestinian state at an impasse. Therefore, we call on the world to exert the necessary pressure to compel Israel to release our money. Otherwise, we will be obliged to take some harsh steps,"
Hanan Ashrawi, a PLO Executive Committee member, told Al-Monitor that the PA faces an economic collapse without the tax revenues. "Since tax funds are the main source of the PA’s treasury, withholding them would impede the work of numerous institutions, thus heralding an economic collapse."
WAFA concluded that Israeli freezing of Palestinian tax revenues has widespread effects on the Palestinian economies, hindering various sectors, including health and social welfare, reported Al-Monitor on its website.