Israeli minister prepares major sanctions on PA after statehood push

Finance Minister calls for immediate halt to transfer of tax funds from Israel to the PA.

By World Israel News Staff

Finance Minister Betzalel Smotrich is proposing to implement serious economic consequences against the Palestinian Authority, following news that Ireland, Spain, and Norway will officially recognize a Palestinian state in the coming days.

“At the last cabinet meeting, many ministers, including myself, made an unequivocal demand that harsh punitive measures be taken against the Palestinian Authority for its unilateral actions against Israel,” Smotrich said in a media statement on Wednesday.

The lawmaker said that Israel should no longer transfer millions of shekels of Palestinian tax money, which Jerusalem collects on behalf of the PA, to the entity.

A complete freeze on the transfers of those funds would render the PA unable to pay its employees. PA President Mahmoud Abbas has vowed that even if such a move occurred, he would continue the pay-for-slay policy – which sees the PA provide terrorists with monthly stipends – over paying salaries to PA workers.

Smotrich also urged the cancellation of the so-called “Norway agreement,” which involves Norway holding money earmarked for Gaza in escrow. Due to Norway’s unilateral recognition of a Palestinian state, Smotrich said, the country can no longer be trusted as a neutral third party to oversee the distribution of those funds.

Additionally, he urged for the Israeli government to establish three new Jewish settlements in Judea and Samaria for each country that recognizes a Palestinian state.

When asked about Smotrich’s proposal at a media conference, U.S. National Security Adviser Jake Sullivan said he believes it’s “wrong on a strategic basis, because withholding funds destabilizes” the region.

Such a move would “undermine the search for security and prosperity for the Palestinian people, which is in Israel’s interests,” he added. “And I think it’s wrong to withhold funds that provide basic goods and services to innocent people.”

Notably, Sullivan did not mention the rampant corruption and theft of funds committed by members of the PA, nor did he mention the pay-for-slay policy.