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PA trapped by tax revenue freeze

Palestinian President Mahmoud Abbas has allegedly promised Israel to further tighten the noose around Hamas in exchange for Israel unfreezing Palestinian tax revenues.
Palestinian Prime Minister Rami Hamdallah talks to media after the first unity government meeting in the West Bank city of Ramallah June 3, 2014. President Barack Obama's administration said on Monday it plans to work with and fund the new Palestinian unity government, and Israel immediately voiced its disappointment with the decision also criticized by some U.S. lawmakers. REUTERS/Mohamad Torokman (WEST BANK - Tags: POLITICS) - RTR3RY8D
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For the second month in a row, Palestinian state employees have not received their full salaries, after Israel froze 500 million shekels ($127 million) on Jan. 3, from the Palestinian tax revenues in response to the demand of the Palestinian Authority (PA) to join the International Criminal Court.

On Jan. 4, chief Palestinian negotiator Saeb Erekat threatened to disband the PA if Israel continues to withhold tax funds. He considered the Israeli measure a collective punishment for Palestinians, as Israel already keeps 3% of the funds collected from the taxes on Palestinian goods.

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