Ramallah: The Palestinian National Authority (PNA) has signalled that it will approach the International Criminal Court (ICC) to sue the Israeli government over Palestinian tax revenues it has withheld.

The PNA said it had been left with no choice after Benjamin Netanyahu’s administration refused to go for arbitration. The PNA said it will seek monetary damages in its lawsuit.

The Israeli regime insists on partial transfers of the funds, after having made deductions to settle ‘outstanding’ dues owed by the Palestinians.

A senior official from the Palestine Liberation Organisation (PLO) told Gulf News that Palestinian economists met with their Israeli counterparts. However, Israel insisted on handling the Palestinian tax revenues on its own terms.

“The ICC seems to be the last Palestinian resort and the first case to be filed against Israel will be [of] Palestinian tax revenues and the illegal Israeli reaction of withholding Palestinian funds on pure political grounds,” said the official, who requested anonymity as the issue is still being discussed by the Palestinian leadership.

“We will seek comprehensive review of the international economic agreements with Israel, including the Paris Economic Protocols.”

The official said that as long as Israel insists and violates signed agreements with the Palestinians, it is Palestine’s right to amend the articles of those agreements to secure in full the regular and monthly transfer of funds, which Israel collects on behalf its behalf from ports on products imported into Palestinians territories.

The Israeli government’s move to withhold the Palestinian tax revenues late last year is largely seen as a punitive measure after the Palestinian leadership signed the Rome Statute and officially joined the ICC in The Hague.

The PNA has gone through severe economic hardships without its tax money and has failed to pay staff their full salaries over the last four months. It was only able to meet half the wage bill by borrowing from local banks.

The Palestinian consensus government announced that salaries crisis will continue until July unless Israel releases the tax revenues it is withholding.

Israel currently holds up to 2.5 billion shekels (Dh2.33 billion) in Palestinian funds, which it has frozen.

The regime caved in to massive international pressure and agreed to resume the transfer of Palestinian funds — albeit after having made deductions.

Israel transferred 1.5 billion shekels of the funds but kept about one billion shekels, which it claimed was to pay Palestinian debts to the Israeli Electricity Corporation and hospitals.

The Palestinian leadership rejected the move and President Mahmoud Abbas proceeded to order that the transferred funds to be returned to Israel.

“We are returning the money. Either they give it to us in full or we go to arbitration or to the ICC on the issue. We will not accept anything else,” Abbas said in his speech in Ramallah at the start of this week.

Palestinian members of the Israeli Knesset (elect), including Ahmad Al Tibi, have intervened to resolve the financial dispute between the Israel government and the PNA.

Al Tibi, an Arab United List lawmaker, said in a statement that Israel had categorically refused to go for arbitration to resolve the issue and schedule the repayment of Palestinian debts to the Israeli Electricity Corporation.

The Israeli utility claims that the PNA owes it 1.9 billion shekels but the Palestinians say the figure does not exceed 500 million shekels.

The company has already petitioned the Israeli Higher Court of Justice demanding that the Netanyahu administration act on this issue and resolve the issue of outstanding debts.

The Israeli utility, which supplies the West Bank with power, has cut off supplies to Nablus and Jenin twice. The first time it did so, it gave the PNA prior notice and but did no such thing the second time around.

“There is sufficient evidence to establish the fact that the amount of the Palestinian debts to the Israeli company has been largely exaggerated as the Israelis add daily interest [charges] to the original debt in yet another violation to the already signed agreement,” the PLO official said.

“The Israelis refuse arbitration because they know they will lose the case. We are ready to pay the original and actual debts and offered a scheme of monthly instalments,” the official said.

Al Tibi, the Palestinian lawmaker in the Israeli Knesset, accused Israel of using withholding tax revenues whenever Palestinians make any political move that Israel does not like.

“It is the ultimate right of the Palestinians to take the dispute to the ICC,” he said.