Sidelined by International Community, Palestinians Accept Tax Money Withheld by Israel
JNS.org – Buckling under severe financial strain and unable to maintain its own threat to reject tax transfers from Israel, the Palestinian Authority this week accepted NIS 1.5 billion (nearly $430 million) in a move it said would not prevent it from continuing to pay terrorists and their families.
Now, in what appears to be a first, some Israeli lawmakers are furious that Israel transferred any money at all to the PA. Knesset Member Bezalel Smotrich and Minister Ze’ev Elkin both expressed concern over the payments, questioning its logic and timing.
Maurice Hirsch, head of legal strategies for Palestinian Media Watch, told JNS that while the transfer is troubling, it’s not against the law. “The law passed last year never said Israel would stop all tax transfers to the Palestinians. What it did say was that the government would take off an equivalent to the amount the PA spends on paying salaries to terrorists, as well as allowances to ‘martyrs.’ ”
Israel currently only withholds money equivalent to the amount that the PA pays terrorists and their families, but does not withhold money paid to families of “martyrs.”
Yossi Kuperwasser, former head of the IDF Intelligence Directorate’s Research Division and now a senior scholar at the Jerusalem Center for Public Affairs, told JNS that the Palestinians “decided this was stupidity, so they decided to take the money.”
“They are losing a lot of money every month,” he said, “because they are happy to pay salaries to terrorists. This reflects their priorities, and we know with whom we are dealing.”
In a recent op-ed for Israel Hayom that was also published on JNS, Kuperwasser wrote, “According to the PA budget implementation report for 2019, the Palestinian Authority transferred 276 million shekels (around $79 million) in payments—i.e., salaries—and another 75 million shekels (around $22 million) in ‘social’ payments to families, family expenses, medical-insurance coverage and legal expenses, among other things. In total, the PA Prisoner Affairs Ministry spent some 364 million shekels ($105 million) on these terrorist payments.”
According to Kuperwasser, the Palestinians spend a significant portion of their budget on terrorist salaries, directly affecting the average civil servant who suffers financially. If the PA’s income shrinks by not agreeing to receive tax funds from Israel, but its expenditure remains the same because it continues to pay salaries to terrorists, then the ratio of these salaries relative to the entire budget goes up.
A large part of the reason that the PA decided to take the money, according to Hirsch, is about governance. “Fatah will not give up its power,” said Hirsch. “They will take the money no matter what excuse they need to tell their people in order to maintain power.”
Hirsch laid out three points surrounding Israel’s law and Palestinian Authority leader Mahmoud Abbas’s decision to finally accept the money.
First, the international community “did not come through” on the PA’s expectation that the Europeans would pressure Israel. “They gave the PA the cold shoulder,” said Hirsch. “The message was clear: We will not pressure Israel if you do not stop paying salaries to terrorists.”
Second, “these laws are not going to change, and they don’t rely on the type of government in power.” Most Israelis across the political spectrum agree and consider rather ludicrous the notion of giving money to the Palestinians so that they can pay terrorists as a reward for killing Israelis.
Third, while there are those who claim that the new law requiring Israel to withhold funds would “cause a third intifada and undermine the whole security situation, the truth of the matter is that it didn’t happen,” said Hirsch. “The negative predictions that everyone had come up with were not warranted and did not materialize.”
’A mind-boggling issue’
The problem now is that while Israel withholds money, the PA continues to pay terrorists anyway, so what has Israel achieved?
Hirsch’s idea is for Israel to further pressure the Palestinians by passing more laws based on already existing legislation that would allow Israel to fine individual Palestinian terrorists an exorbitant amount that would make receiving payments from the PA nothing less than a terrific burden.
Kuperwasser believes that Israel can make headway in convincing the Europeans to take a tougher stance and hold the Palestinians accountable for encouraging terrorism by paying terrorists salaries.
“The Europeans understand you can’t pay salaries to terrorists,” said Kuperwasser. However, he added, “they are so afraid of the Palestinians that even if Palestinians pay terrorists, the Europeans will still give them money. They view the Palestinians as some sort of new religion.”
Kuperwasser was incredulous. “This is a mind-boggling issue. Who can pay salaries to terrorists just because they are terrorists? This is crazy. Even [the Europeans] question [the Palestinians’] policy.”
“I sincerely hope such laws will pass in the European Parliament as well,” said the Mideast scholar. “If the Europeans pass legislation [to withhold funds], this will have a greater impact on the Palestinians, but it is not happening so far.”
Asked if Israel can make progress with the Europeans in convincing them to withhold money and crack down on the PA, Kuperwasser was hopeful, replying, “It is something we can be successful with.”