RAMALLAH, West Bank — After adopting an emergency budget last year as a result of Israel's drastic cut of Palestinian Authority's tax funds, the PA is planning to return to a more normal budget process this year, albeit a cash-strapped one.
The Palestinian Ministry of Finance is preparing the 2020 budget to be submitted to the government for discussion and approval. The government would then refer the budget to President Mahmoud Abbas for ratification since the Palestinian Legislative Council was dissolved by the High Constitutional Court on Dec. 12, 2018.
Palestinian Prime Minister Mohammad Shtayyeh told state-run Palestine TV on Jan. 4, “We will not begin the year 2020 with an emergency budget but an integrated one. We are preparing a budget along the lines of 2019 in terms of financial management.”
The drafting of a comprehensive budget is a challenge for the PA. This will be the first budget for Shtayyeh’s government since the PA did not approve the 2019 budget because of Israel’s decision to deduct about 502 million shekels ($145 million) from PA tax revenue, an amount Israel claims is equivalent to the sum the PA disburses to the families of Palestinian prisoners in Israeli jails and Palestinians killed or injured in attacks against Israelis. In response to Israel’s decision, the PA in February 2019 decided to refuse all tax transfers from Israel. But in October, the PA again accepted the tax transfers following a deal reached between Palestinian Minister of Civil Affairs Hussein al-Sheikh and Israeli Finance Minister Moshe Kahlon.
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