Israel to retain €90m owed to Palestinians
In response to last week’s United Nations vote granting Palestine the status of a non-member observer, Israel will withhold €90 million in tax revenues that were to be transferred to the Palestinian Authority this month.
Finance minister Yuval Steinitz said the money, which is collected from Palestinians working in Israel on behalf of the authority, would offset a debt owed by it to the Israel electric corporation.
He said Israel had warned that there would be repercussions if the Palestinians pushed ahead with their unilateral UN attempt for statehood.
“The provocation is by the Palestinians,” he said. “They are trying to promote a state without recognising Israel, demilitarisation or security arrangements.”
Yasser Abed Rabbo, a senior Palestinian official, said Israel was guilty of “piracy and theft” by refusing to hand over the funds.
The cash-strapped Palestinian economy still relies heavily on foreign aid and tax revenues collected by Israel. The move will make it difficult for Ramallah to pay civil service salaries and provide public services. But Arab states had pledged to make up any cash penalties imposed by Israel.
The decision marks the second punitive measure carried out by Israel in response to the UN vote.
On Friday it was announced that an extra 3,000 homes for Jewish settlers would be built in east Jerusalem and the West Bank, including in the controversial area known as E-1, between Jerusalem and the settlement of Ma’ale Adumim. That decision has been widely condemned by the international community, including the European Union.
Prime minister Binyamin Netanyahu was in belligerent mood as he addressed ministers at yesterday’s cabinet meeting. “We are building, and will continue to build, in any location that serves Israel’s strategic interests.”
He made it clear that Israel rejected Thursday’s UN decision. “No Palestinian state will be established unless it recognises Israel as the state of the Jewish people and declares an end to the conflict.”
Palestinian president Mahmoud Abbas received a hero’s welcome when he returned to Ramallah yesterday from the UN general assembly. “Now we have a state,” he told thousands of cheering supporters. “Palestine has accomplished a historic achievement.”
He said the overwhelming majority at the UN General Assembly showed the international community stood behind the Palestinian people.
“The march was a long one, and the pressures were enormous, but we stood fast and we prevailed, because we are the voice of these people.”