Ramallah in the past has rejected the coopting of its funds, even for purposes that could benefit civilians in Gaza, viewing the move as a violation of its sovereignty. However, the PA is reconsidering its stance given its desperation to secure access to at least some of the money \u201cillegally\u201d held by Israel, the official said, pointing out that Jerusalem is violating the Oslo Accords by holding onto the funds.<\/p>\n
It\u2019s unclear whether the US and Israel will ultimately even seek the PA\u2019s approval to transfer the tax revenues to the Board of Peace.<\/p>\n
The prospect of the Palestinians\u2019 own tax money being repurposed toward Trump\u2019s Gaza rebuilding plan, over which their government has had no input, could further sideline the Western-backed PA even as Israel\u2019s withholding of the funds begets a financial crisis in the West Bank.<\/p>\n
Israel has proposed<\/a> using a portion of the several billions of dollars it is holding to pay for the clearing of rubble for construction projects in Gaza, as well as to cover the cost of the controversial Gaza Humanitarian Foundation\u2019s operations during the war, a PA official told The Times of Israel in January.<\/p>\n \t Ramallah opposes both ideas, arguing that Israel has no right to use its \u201cstolen\u201d funds for rebuilding what the Israel Defense Forces destroyed in the Gaza Strip during the war, the PA official asserted.<\/p>\n The PA exercises limited self-rule in the West Bank but has not had any sway over Gaza since it was violently ousted from the territory after a brief civil war with the Hamas terror group in 2007.<\/p>\n Trump\u2019s plan for Gaza, shattered after more than two years of war, has been held up by a refusal by Hamas to lay down their weapons and by continued Israeli strikes in Gaza that have undermined an October ceasefire.<\/p>\n Israel says the strikes target terror operatives who endanger or attack troops in violation of the ceasefire.<\/p>\n \u2018Money held in a bank does nothing\u2019<\/p>\n The Board of Peace declined to comment on whether a proposal to use Palestinian tax money was under consideration.<\/p>\n A Board official said it had asked all parties to leverage resources to support Trump\u2019s rebuild plan, estimated to cost $70 billion.<\/p>\n \u201cThat includes the Palestinian Authority and Israel. There is no doubt that money held in a bank does nothing to further the President\u2019s 20-Point Plan,\u201d the official said.<\/p>\n That appeared to refer to the PA tax revenue that Israel has withheld from the body in a long-running dispute over payments it makes to families of Palestinian security prisoners and slain attackers \u2014 a policy that Ramallah insists it halted last year.<\/p>\n \t Israel collects taxes on imported goods on behalf of the PA and is meant to transfer the revenue under a longstanding arrangement. The PA uses the funds to pay civil servants and fund public services.<\/p>\n Since the beginning of the Gaza war, Israel has also been withholding the portion of the funds that the PA uses to pay employees and services in the Strip, arguing that the money is at risk of seizure by Hamas.<\/p>\n The sources did not say how much of the tax money Washington was considering asking Israel to transfer to the Board.<\/p>\n The US State Department, Israeli government and Palestinian Authority did not immediately respond to requests for comment.<\/p>\n The US and Israel have long pressured the PA to abolish payments to Palestinian prisoners and families of those killed by Israeli forces, arguing it encourages violence.<\/p>\n Palestinians consider them a form of welfare for inmates they regard as national heroes.<\/p>\n In response to US pressure, the PA in February 2025 said it was reforming the payment system, but the US said those changes did not go far enough. As punishment, Israel has withheld taxes it collects on the PA\u2019s behalf, an amount that Palestinian officials say has reached $5 billion \u2014 well over half of the PA\u2019s annual budget.<\/p>\n \t That has set off a financial crisis in the West Bank, with the PA slashing salaries of thousands of civil servants.<\/p>\n Israel accepted a US invitation to join the Board of Peace. The PA was not invited.<\/p>\n Under Trump\u2019s plan, a group of Palestinian technocrats dubbed the National Committee for the Administration of Gaza would take control of Gaza from Hamas as the militants lay down their weapons.<\/p>\n Nickolay Mladenov, Trump\u2019s Board of Peace envoy for Gaza, said during a press conference in Jerusalem on Wednesday that reconstruction planning was in advanced stages.<\/p>\n \u201cWe\u2019re doing it sector by sector. We\u2019re costing things. We\u2019re coordinating with donors and we\u2019re ready to begin in earnest once the conditions allow it,\u201d Mladenov said, without mentioning the tax issue.<\/p>\n
\t\t\t\t\t\t\t\t\t That\u2019s why we started the Times of Israel – to provide discerning readers like you with must-read coverage of Israel and the Jewish world.<\/p>\n So now we have a request. Unlike other news outlets, we haven\u2019t put up a paywall. But as the journalism we do is costly, we invite readers for whom The Times of Israel has become important to help support our work by joining The Times of Israel Community.<\/p>\n For as little as $6 a month you can help support our quality journalism while enjoying The Times of Israel AD-FREE, as well as accessing exclusive content available only to Times of Israel Community members.<\/p>\n Thank you, \t\t\t
![\"\"](\"https:\/\/www.newsbeep.com\/il\/wp-content\/uploads\/2026\/05\/bead2f4b-c612-4e9d-ba5f-52f6714fce29-640x400.jpg\")
<\/a>
\n\t\tPrime Minister Benjamin Netanyahu meets with Gaza Board of Peace envoy Nickolay Mladenov in Jerusalem on May 13, 2026. (Maayan Toaf\/GPO)<\/p>\n![\"\"](\"https:\/\/www.newsbeep.com\/il\/wp-content\/uploads\/2026\/05\/AFP__20260514__B2UM8P3__v1__HighRes__PalestinianIsraelConflictPolitics-640x400.jpg\")
<\/a>
\n\t\tPalestinian Authority President Mahmoud Abbas (2nd L) chairs the eighth Fatah conference in the West Bank city of Ramallah on May 14, 2026. (Jaafar ASHTIYEH \/ AFP)<\/p>\n![\"\"](\"https:\/\/www.newsbeep.com\/il\/wp-content\/uploads\/2026\/02\/AFP__20260122__93LX7R7__v1__HighRes__SwitzerlandUsPoliticsEconomyDiplomacy-640x400.jpg\")
<\/a>
\n\t\tUS President Donald Trump speaks at a Board of Peace charter announcement during the Annual Meeting of the World Economic Forum in Davos, Switzerland, January 22, 2026. (Fabrice Coffrini\/AFP)<\/p>\n
\n\t\t\t\tYou’re a dedicated reader\t\t\t<\/p>\n![\"\"](\"https:\/\/www.newsbeep.com\/il\/wp-content\/uploads\/2026\/05\/334x334-200x200.png\" "\\"\\"\/")
\t\t\t\t\t\t\t\t\t\t\t\t\t<\/p>\n
David Horovitz, Founding Editor of The Times of Israel<\/p>\n
\n\t\t\t\tJoin Our Community\t\t\t<\/a><\/p>\n