Despite Promise, Israel Still Withholding Palestinian Tax Money

Money Being Withheld Out of 'Political Considerations'

by Jason Ditz, February 18, 2013

Major strikes among educators and health care workers continued in the occupied West Bank today, as Palestinian Authority officials confirmed that they were still unable to pay salaries because Israel is still withholding their tax money.

Israel had announced they were ending the seizures of tax money last month, citing the growing financial crisis in the West Bank, but PA officials say that “political considerations” have kept the funding from being restored.

Under the terms of past agreements, Israel is obliged to collect certain taxes on behalf of the Palestinian Authority, but often withholds those funds when diplomatic disputes break out. The most recent was in December, after the UN recognized Palestine as a “non-member state” and Israel announced a sudden enormous debt to the state-owned Israeli power company was being paid by withholding all Palestinian funds for months on end.

With the occupation keeping private companies more or less out of the West Bank, the Palestinian Authority runs a sort of command economy in its cities, but paying the workers is often a struggle, with so much of its revenue coming from intermittent Israeli tax payments and foreign aid pledges.

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