PA Finance Minister Shukri Bishara
PA Finance Minister Shukri BisharaReuters

The Palestinian Authority (PA) Minister of Finance Shukri Bishara has confirmed that he has met with his Israeli counterpart Moshe Kahlon in Jerusalem in recent weeks to discuss an economic agreement to boost the Palestinian economy, the Ma'an news agency reported Tuesday.

Bishara's remarks are thus in line with a report on Israel's Channel 10 on Sunday that the two finance ministers have been meeting to discuss an "economic package" Israel is planning to offer to the PA.

Bishara told Ma'an the meetings had taken place, although he denied that several issues reported by Channel 10 had in fact been discussed.

The Israeli report had said that the package would have Israel allowing Palestinian real estate developers and contractors to begin construction projects in Israel, as well as allow Palestinian Arab doctors to intern in Israeli hospitals, among other things.

While Bishara denied those issues were discussed with Kahlon, he told Ma'an the chief objective of the meetings had been to discuss the possibility of reaching a new agreement on Israel's share of tax revenue it collects on the PA's behalf.

Bishara said that Israel currently deducts at least three percent of all PA taxes on exports and imports, amounting to 350 million shekels annually, and his delegation was seeking to reduce this.

In recent years, Israel has several times held back the tax revenues it collects for the PA, the last time being last year in retaliation for its moves to join the International Criminal Court (ICC).

However, each time Israel ended up caving in to international pressure and released the frozen revenues.

The PA has repeatedly asked for foreign donations in recent years, claiming it is on the verge of collapse due to a worsening financial crisis.

But, while blaming Israel for the PA’s financial woes, its chairman Mahmoud Abbas continues to spend six percent of the PA’s annual budget to pay $4.5 million a month to jailed terrorists and another $6.5 million to their families.