Norway said on February 18 that it had agreed to help transfer tax money collected by Israel to the Palestinian Authority (PA), providing an important source of finance for the Western-backed PA, according to Reuters.
“This money is essential to prevent the collapse of the Palestinian Authority, to ensure that Palestinians receive vital services and that teachers and health workers are paid,” Norwegian Prime Minister Jonas Gahr Stoere stressed.
An area in the West Bank
The PA exercises limited self-government in the Israeli-occupied West Bank. Under the interim peace accord reached in the 1990s, the Israeli Ministry of Finance collects taxes on behalf of the PA and transfers the proceeds to the PA each month, including a portion for the Gaza Strip.
The taxes Israel collects on behalf of the PA amount to about $188 million a month and account for 64 percent of the PA’s total revenue, according to Aljazeera television. Much of that money is used to pay the salaries of about 150,000 PA employees working in the West Bank and Gaza.
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Although the PA was pushed out of the Gaza Strip in 2007, many civil servants in the area kept their jobs and continued to be paid by tax money transferred by Israel.
However, weeks after Hamas's attack on southern Israel on October 7, 2023, Israel decided to withhold payments to PA personnel in the Gaza Strip, arguing that the money could end up in the hands of Hamas forces.
On November 3, 2023, the Israeli security cabinet voted to withhold a total of $275 million in Palestinian tax money, including cash collected in previous months that remained in Tel Aviv, according to Aljazeera.
The Norwegian government said that under the agreed solution, Norway would act as an intermediary, keeping tax revenue equal to the portion that Israel estimated would go to Gaza, while the PA would receive the rest.
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