Hamas' Band-Aid budget approach can't be expected to stem its fiscal seepage for long, and taxpayers are being drained.

The financial crisis that has plagued Hamas for several years is weighing heavily on Palestinians in the Gaza Strip, as Egypt in 2013 began closing the tunnels between Gaza and the Sinai Peninsula, which served as a major source of income for Hamas. The closures coincided with the gradual halt of Iran’s support to the movement following their differences over Syria, and with the halt of international aid convoys, which were accompanied by financial support for Gaza.

“Hamas' financial policy in Gaza in recent years has had its pros and cons. Hamas has managed to adapt in relative terms to the blockade on Gaza by taking belt-tightening measures in its ministries and government departments," Omar Shaaban, a Palestinian economist and general director of PalThink for Strategic Studies, told Al-Monitor. "However, the movement erred by imposing more taxes, which has weakened the economic cycle in the Gaza Strip, causing a market recession. This has reflected Hamas’ short-sightedness, as it thought that by increasing taxes it would increase its financial resources. Yet, all it has done is push traders to disengage from the economic process.” 

In light of the financial crisis, Hamas has failed to pay the salaries of its employees on a regular basis. Services provided to Gazans have declined, power cuts have increased and people's dissatisfaction with the government’s performance has mounted.