Israeli Finance Minister Bezalel Smotrich (Reuters)
Israeli Finance Minister Bezalel Smotrich on Friday renewed his rejection of US demands to transfer the full clearance funds to the Palestinian Authority.
Smotrich, who leads the far-right Religious Zionism party, said: "We have great respect for the United States, our best ally in the world, and for President Joe Biden, a true friend of Israel, but we will never leave our fate in the hands of foreigners."
Smotrich's comment came after Walla reported on Thursday that Biden had a difficult conversation last weekend with Prime Minister Benjamin Netanyahu over Israel's decision to withhold part of the tax revenues it collects for the Palestinian Authority.
The Biden administration has expressed fears that the PA's economic collapse could lead to a violent escalation in the West Bank, as a result of its inability to pay the salaries of its security forces.
But Smotrich stressed that as finance minister, "not a single shekel will go to Gaza."
Since the beginning of the war on Gaza on October 7, Smotrich has announced his refusal to transfer all clearance funds to the Palestinian Authority.
Collection and distribution mechanism
Israel collects taxes on behalf of the PA for Palestinian imports on imported goods and transfers money to it on an average of NIS 750-800 million (about $190 million), of which NIS 270 million (about $75 million) is normally transferred to the Gaza Strip.
The funds allocated to Gaza are distributed about 170 million shekels to the salaries of Palestinian Authority employees in the Gaza Strip, and 100 million shekels to pay the fuel bill for the Gaza power plant.
The PA relies heavily on this money, called clearing, to pay public sector salaries.
Last November, Smotrich conditioned the transfer of the clearance by deducting the Gaza Strip's share of it, which the Palestinian Authority rejected, announcing its decision to refuse to receive the funds in short.
Over the past two months, the PA has been able to pay public sector salaries only partially, borrowing from local banks.
Source : Anadolu Agency