newsIsrael-Palestinian Conflict

PA to accept funds from Israel, receive Gaza tranche after war

The portion earmarked for Gaza will remain in escrow in Norway till after the war against Hamas.

Palestinian Authority leader Mahmoud Abbas attends a meeting in the Samaria city of Ramallah, March 10, 2019. Photo by Hadas Parush/Flash90.
Palestinian Authority leader Mahmoud Abbas attends a meeting in the Samaria city of Ramallah, March 10, 2019. Photo by Hadas Parush/Flash90.

The Palestinian Authority has agreed to receive the tax revenue collected by Israel on its behalf, minus the sum earmarked for the Gaza Strip, Sky News Arabia reported on Monday.

Palestinian sources told the broadcaster that the P.A. has dropped its objections to the partial transfer. Ramallah reportedly agreed to a U.S.-backed outline with Israel, under which the funds for Gaza will be held by Norway for safekeeping until after the war against Hamas.

The source said the P.A. would still transfer payments to “pensioners and needy families” in Gaza as long as they appear on the lists of its Ministry of Social Development, using the funds earmarked for Judea and Samaria.

Under agreements signed in the 1990s, Israel’s Finance Ministry collects taxes and customs duties on behalf of the P.A. Ramallah earmarks an estimated 275 million shekels, or $73 million, for Gaza each month.

On Nov. 2, although agreeing to send the revenue to the P.A., the Israeli Security Cabinet voted to freeze funds equivalent to those the P.A. sends to the Strip. The decision came at the insistence of Israeli Finance Minister Bezalel Smotrich, out of concern the funds could end up in Hamas’s hands.

Hamas terrorists killed more than 1,200 people, mostly civilians, and wounded thousands in the Oct. 7, 2023 attacks on Israel’s northwestern Negev region. In addition, terrorists took some 240 people hostage.

The outline for the transfer, which Jerusalem approved on Sunday, prevents the Gaza money from reaching the P.A. “under any circumstances” unless approved by Smotrich, the Prime Minister’s Office said in an earlier statement.

The United States will act as guarantor of the agreement, according to the PMO.

Hussein al-Sheikh, the secretary-general of the PLO Executive Committee, tweeted on Monday that “the Palestinian leadership is examining all proposals to solve the current financial crisis.”

The P.A. “insists on its position of commitment to our people in the Gaza Strip. The leadership appreciates the efforts made by brotherly and friendly countries to end the financial crisis,” added al-Sheikh.

Al-Sheikh’s statement indicated a shift in tone—the previous day, the Palestinian official had accused Israel of “piracy and stealing the money of the Palestinian people,” saying that “any deductions from our financial rights or any conditions imposed by Israel that prevent the P.A. from paying our people in the Gaza Strip are rejected by us.”

Israel’s decision to transfer a portion of the tax funds included the amount the P.A. devotes to its “pay-for-slay” program to reward jailed terrorists and their families for carrying out attacks on Jews.

Since Hamas’s Oct. 7 massacre, the P.A. has added thousands of Palestinians to its list of people who qualify to receive monthly terror stipends. P.A. officials announced that 3,550 additional terrorists imprisoned in Israel will receive payouts, according to analysts.

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