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Israel to give $100 million in withheld Palestinian funds
Published Wednesday 30/01/2013 (updated) 03/02/2013 12:22
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JERUSALEM (Reuters) -- Israel will give President Mahmoud Abbas's administration around $100 million in tax revenues that had been withheld in retaliation for his statehood bid in the United Nations, Israeli officials said on Wednesday.

They described the handover as a one-time deal, signalling rightist Israeli Prime Minister Benjamin Netanyahu had not formally scrapped sanctions that have hurt the Palestinian Authority in the occupied West Bank and worried world powers.

But the decision follows surprise setbacks for Netanyahu in a national election this month that, while giving him enough of a lead to head the next Israeli government, also set the stage for more moderate statecraft by boosting centrist challengers whom he must now consider as coalition partners.

Under interim peace deals, Israel collects some $100 million a month in duties on behalf of the Palestinian Authority, money Abbas badly needs to pay public sector salaries. It began withholding the funds as punishment for the UN's acceptance of Palestine as a non-member state in November.

Israel said the December levies would be used instead to start paying off $200 million the Palestinians owe the Israel Electric Corporation, and predicted at the time that the lien on PA funds would be in force until March at least.

The PA's economic troubles were raised this week in a meeting between Netanyahu and Tony Blair, peace envoy for the United States, United Nations, European Union and Russia, an Israeli official said.

Following those talks, the official told Reuters on condition of anonymity, "we have agreed to transfer one month's payment, because of the difficult financial situation there.

"This is a one-time decision and there is no decision yet on what will happen next."

Another Israeli official said the handover would take place imminently, "perhaps even today".

Israel has previously frozen payments to the PA during times of heightened security and diplomatic tensions, provoking strong international criticism, such as when the UN cultural body UNESCO granted the Palestinians full membership in 2011.

Abbas's UN victory was a diplomatic setback for the United States and Israel, which were joined by only seven other countries in voting against upgrading the Palestinians' observer status to "non-member state", like the Vatican, from "entity".

Hours after the UN vote, Israel said it would authorize 3,000 new settler homes in the West Bank and East Jerusalem and expedite planning work for thousands more in a geographically sensitive area close to Jerusalem. Critics say this plan would kill off Palestinian hopes of a viable state.

Netanyahu's current religious-nationalist government looks likely to be replaced with a coalition more accommodating of the Palestinians.

The runners-up in the Jan. 22 ballot, the centrist Yesh Atid and left-leaning Labor parties, both demand Israel try to revive peacemaking stalled for more than two years.
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1 ) Mark of Lewiston / USA
30/01/2013 10:59
If Palestine is to be a country, it needs its own taxes, not some Israeli VAT tax. Palestine should also collect its own taxes and repeal any Israeli taxes. Time also to consider your own currency. Build your own utilities. Makes for a better economy and fuller employment. If you are a country, start acting like one. Start acting like an independent state.

2 ) AKeenReader / UK
30/01/2013 19:08
It's Palestinian money in the first place therefore shouldn't termed as 'giving' . Sounds as if Israeli's are being generous by giving it back. They withhold money and then blackmail the Palestinians afterwards into submission.

3 ) @ Akeen-2 / USA too
30/01/2013 21:33
"In the first place, it's Palestinian" ELECTRIC DEBTS that their monies were withheld to pay, and
In the 2nd place, every nation of the world has similar methods of either:
- collecting unpaid debts, or
- terminating services, though Israel terminating electricity services to Ramallah and other prts of the Areas A/B may have been the better option !!

Also, there is NO mention in Israel medias, of any plan "to give $100 million in withheld Palestinian funds."

4 ) The Sentinel / USA
30/01/2013 22:41
Israel is collecting duties 'on behalf of' the PA? How is it possible the Israeli government get its hands on that money to begin with? It sounds like more of the same old tired oppression that's been going on for too long.

5 ) Mo / Canada
30/01/2013 23:37
So, (2) What do you call Palestinians not paying paying back what they owe the Israeli electric company. Israel is not just hoarding on to the money or spending it freely, they are paying back PA debts

6 ) gabi / australia
31/01/2013 00:40
#1 - Mark - how do you stop Israel collecting the tax? Or rather, taking the tax.

7 ) Mel / USA
31/01/2013 01:38
Withholding Palestinian monies is ILLEGAL & so f**king colonial.It's time for our USA to cut all FISCAL SUPPORT to Israel,FOR EVER! Just like the America cut the colonial cord to King George!STOP ALL THE CHECKS,grants,subs,interest-free'gifts'to Zionist Israel! It doesn't DESERVE IT!
Israel OWES Palestinians interest ,on all withheld monies.And 340 MILLION Americans WANT OUR INTEREST BACK,for 50yrs of FMF annual EXpropriation of our TAXES(illegally) to ROGUE-STATE Israel.Then CUT THE CORD!

8 ) Colin Wright / USA
31/01/2013 03:42
'Israel to give $100 million in withheld Palestinian funds' How can you 'give' something that wasn't yours in the first place? All Ma'an staffers will be relieved to hear I've decided to 'give' them their salaries for the next month.

9 ) Colin Wright / USA
31/01/2013 03:44
To Mark of Lewiston #1: ' ...If you are a country, start acting like one. Start acting like an independent state.' Ahem. You do realize you are advocating 'terrorism,' don't you? You'd better watch it: this isn't your grandfather's America any more.

10 ) Filipe / Portugal
31/01/2013 07:41
@AKeenReader, What happens to people where you live who fail to pay their utility bills ??

11 ) gabi / australia
02/02/2013 02:22
# 10 - it's really simple. The utility company uses its own power to get the debt paid. Israeli law seems different from the law here, eg if A owes money to B, and C holds money belonging to A ( which actually means holds it on trust for A), they can't just decide to pay it to B instead. However in Israel it seems C pays A's money to B. Without A's consent. And in breach of trust. Weird!
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