PMW Bulletins
Abbas to inflict humanitarian crisis on Palestinians, after Israel penalizes PA for its support of terrorists
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 Abbas about to inflict 
serious humanitarian crisis on Palestinians,
in response to Israeli decision to penalize PA
 for its support of terrorists
  • PA to refuse approx. $2.2 billion (8 billion shekels) transfer of taxes from Israel in 2019, because Israel decided to deduct approx. $139.5 million (502 million shekels) that the PA uses to reward terrorists
  • PA shows it prioritizes terrorist rewards over best interests of entire Palestinian non-terrorist population
  • PA's refusal to accept nearly half of its budget would cripple the PA economy and cause a humanitarian crisis
by Itamar Marcus, Maurice Hirsch and Nan Jacques Zilberdik 
 
PA Chairman Mahmoud Abbas has officially announced that the PA will refuse to accept all tax money Israel transfers to the PA if Israel deducts the amount the PA uses to reward terrorists. This PA policy will lead to a grave humanitarian crisis for Palestinians.
 
The Israeli Cabinet announced yesterday that Israel will be deducting 502,697,000 shekels/year - $139,638,000 - from taxes to be transferred to the PA. This is the amount reported exclusively by PMW that the PA paid in 2018 in salaries to imprisoned and released terrorists. This sum does not include the PA's financial rewards to families of dead terrorists, the so-called "Martyrs," or to wounded terrorists. The deduction will be made in 12 monthly portions of approx. $11,636,500 million/month - almost 42 million shekels/month.
 
Information obtained by PMW from Israel's Ministry of Finance in response to a request based on Israel's Freedom of Information Act, shows that the taxes Israel collected and transferred to the PA in 2018 amounted to $2.2 billion (8 billion shekels) - an average of $186,121,569/month (670,037,651 shekels) - while PA payments to terrorist prisoners, released prisoners, and families of dead terrorists in 2018 averaged at least $204 million/year (732 million shekels/year), or $17 million/month (61 million shekels) according to PMW calculations.
 
Earlier this month, Abbas declared that if Israel deducts a sum equal to what the PA spends on rewarding terrorists from next month's transfer - approx. $11.6 million according to the sum announced by the Israeli Cabinet - he will refuse to accept the entire remainder - approx. $174.5 million/month - that the Palestinian population needs to keep the economy functioning:
 
"[PA] Minister of Civil Affairs [and Fatah Central Committee member] Hussein Al-Sheikh said yesterday [Feb. 10, 2019] that he has conveyed an official message at the request of [PA] President Mahmoud Abbas that emphasizes that 'He will refuse to receive the collected [tax] money if Israel deducts even one penny from it.'"
[Official PA daily Al-Hayat Al-Jadida, Feb. 11, 2019]
 
If Abbas follows through with his decision and the PA refuses to accept this money next month, it will conclusively confirm that Abbas and the PA prioritize rewarding terrorists and murderers rather than the best interests of the entire Palestinian population. Instead of accepting that Israel refuses to transfer $11.6 million/month for terror rewards, Abbas prefers to punish the entire Palestinian population by refusing $174.5 million of tax money, which would benefit all Palestinians.
 
Indeed, if Abbas maintains this decision, the entire Palestinian economic infrastructure could ground to a halt. As the following chart shows, at least since 2014, the taxes collected by Israel have accounted for approximately 50% of the PA's operational budget - i.e. the PA's entire budget less its debt payments. In 2018, the average monthly tax income was $186,121,569 million/month (670 million shekels). By refusing the remainder of this sum after the sum of the terrorist salaries is deducted, Abbas is intentionally preventing his people from receiving a huge part of their annual needs:

Why would Abbas be bringing such a financial and humanitarian crisis on the Palestinian population?

Firstly, it is possible that Abbas intends to try and use the tactic of impoverishing the Palestinian population to put pressure on Israel to transfer to him the money he uses for terror. Secondly, he may hope that the international community will pressure Israel to ignore its own laws. Thirdly, he may expect the international community to again subsidize the PA. Alongside the financial leverage Abbas hopes to gain, it is also possible that he is going to use the deduction, and the ensuing self-made crisis, to spark yet another wave of terror.

Whatever the motivation, Abbas has shown once again that rewarding terrorists is a high Palestinian Authority priority.

Israel is deducting this money following the passage of a law last year mandating that Israel deduct and freeze the amount
the PA paid to reward terror in 2018 from the tax money Israel collects for the PA. The frozen funds would be given to the PA if it were to abolish its "pay for slay" policy.

Abbas could have all the money if only he would stop rewarding terror, but he refuses. 

In October 2018, Abbas declared:


"I say this to everyone - the salaries of our Martyrs, prisoners, and wounded are a red line. They [Israel] try by all means, and exert pressure by all means, and they continue to exert: "It cannot be that you will pay." And they'll even deduct our money that's in their hands. They'll deduct from it the amount that we pay to the Martyrs. We have said that this is a red line and we will not allow [it]. From 1965 until now, this matter is sacred to us. The Martyrs and their families are sacred, [and so are] the wounded and the prisoners. We must pay all of them. If one penny remains in our hands it is for them and not for the living.
[Official PA TV, Oct. 28, 2018]

When Israel temporarily stopped the transfer of the taxes in December 2014, by February 2015 the PA was forced to order reduction in the salaries to all civil servants and terrorist prisoners, who as a result of the financial crisis received only 60% of their regular PA salaries:

"Coordinator of the Committee for Prisoners and Released Prisoners' Affairs Husni Zalum said that the salaries of the prisoners and released prisoners in the occupation prisons will be paid through the banks at noon today. Zalum told the Wattan News Agency that they had been notified by the [PA] Ministry of Finance about this, and that it would be made the same way as last month: A full salary will be paid to those entitled to less than 2,000 shekels per month, while 60% of the basic salary will be paid to those receiving a salary above 2,000 shekels."
[Wattan News Agency, March 5, 2015]

Following the Israeli Cabinet's decision yesterday, Abbas' spokesman Nabil Abu Rudeina stated that the Israeli decision "will have serious repercussions at all levels" and that it constitutes "piracy":

"Any deduction from the Palestinian clearing funds is totally rejected and is considered a piracy of the Palestinian people's money."
[WAFA, official PA news agency, English edition, Feb. 17, 2019]

Abu Rudeina also repeated that the PA will continue to support terrorists:

"[It is] the firm position of the President [Abbas] in which he affirmed that we will not accept any harm to the livelihood of our imprisoned heroes and the families of martyrs and wounded."

Similarly, Director of the PLO Commission of Prisoners' Affairs Qadri Abu Bakr emphasized last week that the PA will continue to reward terrorists with salaries:

"As the Palestinian leadership has emphasized, the salaries (rawatib) will not be harmed."
[Official PA daily Al-Hayat Al-Jadida, Feb. 12, 2019]

The following is the Israel Security Cabinet's communique about the deduction of PA taxes:

"Security Cabinet Communique

(Communicated by the Prime Minister's Media Adviser)

The Security Cabinet, today (Sunday, 17 February 2019), decided to implement the law freezing Palestinian Authority funds, which was approved by the Knesset in July 2018, and to deduct NIS 502,697,000 from the funds designated for transfer to the Palestinian Authority by the State of Israel.

Security officials presented data to the effect that in 2018, the Palestinian Authority transferred the aforesaid amount to terrorists imprisoned in Israel and their families and to released prisoners. Therefore, it was decided to freeze the same amount of funds from the tax revenues that Israel collects for the Palestinian Authority.

Prime Minister and Defense Minister Benjamin Netanyahu instructed security officials to step up checks on additional Palestinian Authority payments linked to terrorism, including those to terrorists and their families. The amount frozen will be updated as per the information received."
[Israeli Prime Minister's Office, Feb. 17, 2019]