US President Joe Biden held a difficult conversation last weekend with Prime Minister Benjamin Netanyahu over Israel's decision to withhold part of the tax revenue it collects for the Palestinian Authority, Barak Ravid of Axios reported on Thursday, citing two US and Israeli officials and a source with knowledge of the issue.
A US official told Ravid that this part of last Saturday's call between the two leaders was one of the most difficult and "frustrating" conversations Biden has had with Netanyahu since the beginning of the war in Gaza.
Israel’s Political-Security Cabinet decided last month to offset money intended for the Gaza Strip from the tax money it collects on behalf of the PA, in addition to the offset that is carried out, in accordance with the law, of funds paid to terrorists and their families.
However, the decision states that after the offset, Israel will transfer the tax money to the Palestinian Authority during the war.
The PA was livid at Israel for offsetting the funds intended for Gaza and, as a result, announced it would refuse to accept a partial transfer of the funds.
In recent weeks the Biden administration has been pressing the Israeli government to release the PA tax revenues it is withholding, according to Axios.
The Biden administration has expressed concerns that an economic collapse of the PA could lead to a violent escalation in Judea and Samaria as a result of it not being able to pay its security forces their salaries.
While Saturday's 45-minute call between Biden and Netanyahu focused on the next phase of Israel's ground operation, officials told Ravid that towards the end of the call, Biden raised his concerns about the withheld PA tax revenues.
According to the officials, Biden asked Netanyahu to accept a proposal that the Prime Minister raised himself several weeks ago: to transfer the withheld tax revenues to Norway for safekeeping until an arrangement can be found that will assuage Israel's concerns that the funds could reach Hamas.
A US official and a source with knowledge of the call told Ravid that Netanyahu backtracked and said he doesn't think this is a good idea anymore. He told Biden he doesn't trust the Norwegians and said the Palestinian Authority should just accept the partial transfer of the funds.
Biden pushed back and said the US trusts Norway's proposal and this should be enough for Israel to trust it too, the US official and the source with knowledge of the call said.
After a few minutes of discussion, according to the report, Biden told Netanyahu he expects him to solve this issue, added that "this conversation is over" and ended the call, the sources said.
A White House spokesperson said the conversation between Biden and Netanyahu was "good and productive." The Prime Minister's Office did not immediately respond to a request for comment.