Gov’t expected to release PA tax funds

Israel Beiteinu expected to oppose the move; Icelandic parliament passes resolution to recognize Palestinian state.

By HERB KEINON
Abbas meets Mashaal in Cairo 311 (R) (photo credit: REUTERS/Mohamed Al Hams/Handout)
Abbas meets Mashaal in Cairo 311 (R)
(photo credit: REUTERS/Mohamed Al Hams/Handout)
Prime Minister Binyamin Netanyahu is expected to convene his senior cabinet on Wednesday to decide on the release of $100 million in Palestinian tax revenue that Israel has been withholding since the beginning of the month.
While it was not immediately clear whether Netanyahu would convene his forum of eight senior ministers to decide on the matter, or whether it would be raised at the weekly security cabinet meeting of 14 ministers, one senior government source said the prime minister has a majority in both forums for freeing up the funds.
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He will, however, face opposition from Foreign Minister Avigdor Lieberman, who has come out unequivocally against the move, saying Monday his Israel Beiteinu party would “do everything possible” to prevent the transfer of the funds. Lieberman made clear, however, that despite his objections, his party would not break up the coalition over the issue.
Netanyahu told the Knesset Foreign Affairs and Defense Committee on Monday that he supported transferring the money now because the situation with the Palestinians had “calmed down,” and the Palestinian Authority has at least temporarily put a hold on seeking statehood recognition in various UN bodies.
The decision to freeze the money, which according to EU numbers makes up some 30 percent of the PA budget, was taken at the beginning of the month after UNESCO voted to accept the Palestinians as a full member. In addition to freezing the funds, Israel also decided to react to that move by accelerating the building of some 2,000 housing units in Jewish neighborhoods in east Jerusalem, as well as in Efrat and Ma’aleh Adumim.
According to government sources, Netanyahu believes that if the PA returns to its proactive efforts at the UN, Israel could once again freeze the funds. Under the terms of the Oslo agreements, Israel collects the tax monies each month and transfers them to the PA. Netanyahu said in the Knesset that Israel ultimately doesn’t want to see the PA fail.
The prime minister has come under intensive international pressure over the past couple of weeks to transfer the money, with one argument being that the funds pay the salaries of the PA security apparatus, and it is in Israel’s interest for that apparatus to continue functioning.
Israel froze the funds a number of times during the height of the Second Intifada as a way of placing pressure on the PA.
Iceland’s parliament, meanwhile, voted Tuesday in favor of recognizing a Palestinian state within the 1967 lines.
The vote paves the way for formal recognition by the small north Atlantic island.
“Iceland is the first Western European country to take this step,” Foreign Minister Össur Skarphedinsson told Icelandic state broadcaster RUV. “I now have the formal authority to declare our recognition of Palestine.”
The resolution, proposed by the foreign minister, “urges Israelis and Palestinians to seek a peace agreement on the basis of international law and UN resolutions, which include the mutual recognition of the state of Israel and the state of Palestine.”
Despite Skarphedinsson’s claim, both Malta and Cyprus recognized the state of Palestine after the PLO declared a state in November 1988.
While Israel had no formal reaction to the move, one foreign ministry spokesman said it was a “disappointment” and would only “encourage the Palestinians to avoid negotiations.”
The spokesman also said there was little real significance in the step, saying Iceland is not an EU member, and that the EU – as part of the Quartet that also includes the US, Russia and the UN – has come out against unilateral Palestinian statehood, and instead is working to try and restart negotiations.
In other diplomatic developments, Israel and Russia held a strategic affairs dialogue in Jerusalem on Tuesday that focused on Iran.
The Russian delegation was headed by Deputy Minister of Foreign Affairs Sergey Ryabkov, a key Russian interlocutor on the Iranian nuclear issue. The Israeli team was headed by Jeremy Issacharoff, the foreign ministry’s deputy director-general for Strategic Affairs. Lieberman also met with Ryabkov.
A similar strategic dialogue with the US and in Washington is scheduled for Thursday.
Deputy Foreign Minister Danny Ayalon left Tuesday night for the meeting, which is also expected to focus on Iran.
The US team at the meeting will be headed by Deputy Secretary of State William Burns.
Reuters contributed to this report.