Abbas rejects tax money after Israel deducts debts

The Palestinian Authority leader claimed he was rejecting Israel’s transfer of tax funds because of deductions made to cover debt, and said he will go to arbitration or court.

Palestinian President Mahmoud Abbas said Sunday he rejected Israel’s offer of a partial transfer of tax revenues it collects for the Palestinians, following a three-month freeze.

Abbas said Israel wants to keep a large part of the frozen tax funds to settle debts incurred by his Palestinian Authority, including unpaid utility bills.

“They [the Israelis] said they are going to send us our tax money,” Abbas said Sunday. “But when they sent it, they deducted one third…. We said ‘no’ and sent the money back, saying either we resort to arbitration or court.”

Israeli officials were not immediately available for comment.

Under existing agreements, Israel collects taxes and customs on behalf of the Palestinians and then transfers the sums to the Palestinian Authority (PA), Abbas’ self-rule government. The tax transfers account for 70 percent of the PA’s revenue.

The decision in January to withhold the funds was made in response to the PA’s bid to join the International Criminal Court (ICC) in order to charge the Jewish State with “war crimes” as part of its diplomatic campaign against Israel.

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Last week, Israeli Prime Minister Benjamin Netanyahu announced his decision to release the frozen tax funds Israel had collected on behalf of the PA, citing regional stability, humanitarian concerns and an “overall consideration of Israel’s interests at this time.”

The Palestinians owe over a billion shekels to Israel’s Electric Corporation (IEC) and many millions to Israeli hospitals.

By: AP and World Israel News Staff