29 April 2011 - 19:30

Israel announced Sunday it was halting tax and customs duties payments to the Palestinians in a move coming days after the reconciliation between the rival Fatah and Hamas groups.

(Ahlul Bayt News Agency) -  Finance Minister Juval Steinitz told Israeli army radio that for the time being, a payment due this week of 300 million shekels (89 million dollars) was being held back, pending clarification that the money would not end up in the hands of militants.

"They must now clarify whether there is a joint treasury of Fatah and Hamas," Steinitz said.

"Naturally Israel cannot transfer any money to the treasury of Hamas, a terrorist organisation," he added.

Under existing agreements with the Palestinian Autonomy Authority, Israel is obligated to transfer tax and customs proceeds which it collects on behalf of the Palestinians.

By Steinitz' account these amount to three to 3.5 billion shekels per year.

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