Israel intends to reduce monthly transfers of tax collected on behalf of the Palestinians in what aides to Prime Minister Benjamin Netanyahu described as a response to the killing of two Israelis in Palestinian attacks in the occupied West Bank this week.
The amount deducted from about $130 million sent to the Palestinian Authority each month will be equal to stipends it pays militants in Israeli prisons and the families of jailed or slain militants, Netanyahu's office said on Friday.
"Incitement and payouts to terrorists and their relatives constitute an incentive to murder," it said in a statement.
Palestinian gunmen killed an Israeli and wounded three others in an attack on a family car in the West Bank on Friday, the Israeli army and medics said. On Thursday, a Palestinian stabbed a 13-year-old girl to death in a West Bank settlement