Skip to main content

Sign up for our newsletter.

Quality journalism. Progressive values. Direct to your inbox.

Israel's retaliatory freezing of Palestinian tax revenue sparked a growing boycott in the West Bank. (Photo: Paolo Cuttitta/flickr/cc)

Israel's retaliatory freezing of Palestinian tax revenue sparked a growing boycott in the West Bank. (Photo: Paolo Cuttitta/flickr/cc)

Israel's Seizure of Palestinian Taxes Sparks Economic Devastation, Mounting Resistance

Palestinian officials warn economy is teetering and government is close to default

Sarah Lazare

As Israel continues to withhold $130 million a month in revenue from the Palestinian Authority, officials warn that the West Bank's already choked economy is teetering over the edge, with most public employees facing salary cuts of 40 percent or more and the government close to default.

"We have informed the Palestinian Authority that we have reached the limits permitted to them, or are about to get there, and that banks will not be able to continue to fund it," Palestinian central bank Governor Jihad al-Wazir told Reuters on Wednesday.

"The situation in general is very tough," al-Wazir continued. "Suspending the tax transfers is leading to a rapid economic deterioration."

Ordinary people are bearing the brunt of these policies. Reuters reports:

Nidal Sadqa is a 47-year-old father of four who works for the Palestinian economy ministry in Ramallah and for the past three months he has been paid 60 percent of his usual salary. Half of what's left each month pays bank loans and other debts.

"I haven't paid the rent for three months and I owe the supermarket for things I've already taken," he said, describing circumstances familiar to the nearly 160,000 people employed by the Palestinian Authority in Gaza and the West Bank.

Israel froze the tax revenue in early January in retaliation for the PA's formal application to join the International Criminal Court. Since then, it has withheld over $500 million. These funds account for approximately two thirds of the PA's budget and are used to pay tens of thousands of public employees, according to Haaretz.

In response, Palestinians are reinvigorating a boycott of Israeli companies, specifically targeting Tnuva, Elite, Strauss Osem, Prigat, and Jafora. This escalation is a "first step against arbitrary Israeli procedure," according to a statement from the Palestinian Farmers' Union. While not a new tactic, reports indicate that the latest boycott marks an escalation, with Palestinians taking the step of confiscating and dumping Israeli goods.

Called by numerous Palestinian factions, including Fateh, the boycott shows "grassroots movements are compelling the Palestinian Authority — the largest employer in the West Bank and Gaza Strip, but derided for 'security coordination' with the Israeli army — to adopt the rhetoric of boycott, according to Rosie Lyse-Thompson writing for The Electronic Intifada.

Alaa Tartir of the Palestinian Policy Network argued last week in The Huffington Post that many believe Israel is trying to dismantle the PA altogether, and this might not be all bad.

Such developments "would alter the imbalance of power, expose the international community and the aid industry, force Israel to deal with the costs of its occupation, and allow the Palestinians to re-set their priorities and agenda, while possibly reinventing their political system," Tartir argued.

"The PA remains a product created by the international community, and not by the Palestinian people," he added.

Our work is licensed under Creative Commons (CC BY-NC-ND 3.0). Feel free to republish and share widely.

We've had enough. The 1% own and operate the corporate media. They are doing everything they can to defend the status quo, squash dissent and protect the wealthy and the powerful. The Common Dreams media model is different. We cover the news that matters to the 99%. Our mission? To inform. To inspire. To ignite change for the common good. How? Nonprofit. Independent. Reader-supported. Free to read. Free to republish. Free to share. With no advertising. No paywalls. No selling of your data. Thousands of small donations fund our newsroom and allow us to continue publishing. Can you chip in? We can't do it without you. Thank you.

'Intentional Vandalism' Leaves Thousands Without Power in North Carolina

One right-wing extremist implied that multiple electrical substations were targeted to disrupt a drag show in Moore County. Local law enforcement authorities and the FBI are investigating.

Kenny Stancil ·

GOP Silence on Trump's Call to Axe Constitution Reveals 'Full Embrace of Fascism': House Dem

"Last week the leader of the Republican Party had dinner with a Nazi leader and a man who called Adolf Hitler 'great,'" said Rep. Bill Pascrell. "Yesterday Trump called for throwing out the Constitution and making himself dictator."

Kenny Stancil ·

Protesting Fuel Poverty, People Tell UK Government to 'Keep Everyone Warm This Winter'

As energy bills—and fossil fuel profits—continue to soar, demonstrators around Britain demanded immediate action from Prime Minister Rishi Sunak and members of Parliament.

Kenny Stancil ·

'Turn Off the Tap on Plastic,' UN Chief Declares Amid Debate Over New Global Treaty

"Plastics are fossil fuels in another form," said U.N. Secretary-General António Guterres, "and pose a serious threat to human rights, the climate, and biodiversity."

Kenny Stancil ·

EPA Urged to 'Finish the Job' After Latest Move to Protect Bristol Bay From Pebble Mine

"Local residents, scientists, and the broader public all agree that this is quite simply a bad place for a mine, and it is past time for the EPA to take Pebble off the table permanently," said one activist in Alaska.

Jessica Corbett ·

Common Dreams Logo