Palestinian Authority refuses tax revenues from Israel

RAMALLAH, West Bank (AP) — The Palestinian Authority says it will not accept tax revenues from Israel following the latter’s decision to deduct sums Palestinians pay to prisoners and people killed in fighting with Israel.

Hussein al-Sheikh, who coordinates the Palestinian Authority’s communication with Israel, said Wednesday that the government would refuse the tax transfers this month.

Israel announced last week that it would withhold over $138 million in revenues to penalize the Palestinian leadership for paying stipends to Palestinian attackers and their families.

The revenues that Israel collects on behalf of the Western-backed Palestinian Authority constitute two thirds of the government budget. Analysts expect that without these funds, the cash-strapped Palestinian leadership cannot pay full salaries to its employees.

Palestinian officials describe the payments as important social welfare. Israel says the stipends encourage violence.

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