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Palestinian Authority refuses tax revenues from Israel this month

The Palestinian Authority 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, AP reports. Israel announced last week that it would withhold over US$138 million in revenues to penalize the Palestinian leadership for paying stipends to Palestinian attackers and their families. Palestinian officials describe the payments as important social welfare, while Israel says the stipends encourage violence. The revenues that Israel collects on behalf of the Palestinian Authority constitute two-thirds of the government budget. Analysts says that without these funds, the cash-strapped Palestinian leadership cannot pay full salaries to its employees.