The Palestinian Authority will once again accept tax revenues collected on its behalf by Israel, after rejecting the money for months, Israeli and Palestinian officials said on Friday.
The PA had stopped taking the money because of a dispute with Israel over the stipends paid to the families of Palestinians terrorists killed or jailed by Israel.
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In February, Israel announced it would cut by 5% the approximately $190 million in tax revenues it transfers to the Palestinian Authority each month from imports that reach Judea and Samaria and Hamas-run Gaza Strip via Israeli ports.
The deducted sum represents the amount of money paid by the PA to families of Palestinian terrorists, including those who carried out deadly attacks on Israelis. The PA has increased those payments as of late, despite Israel's decision to withhold some of the tax revenues as a punitive measure.
The PA's decision on Friday to accept the reduced tax revenues could help it relieve a deepening financial crisis. A spokeswoman for the Israeli Finance Ministry said that 1.5 billion shekels (about $430 million) would be handed over to the PA on Sunday.
Hussein al-Sheikh, the PA civil affairs minister, said that following understandings reached with Israeli Finance Minister Moshe Kahlon on Thursday, both sides would begin discussions on a range of financial issues next week.
"The agreement was also on transferring a payment from the PA's financial dues. The dispute remains over the salaries of the families of prisoners and martyrs. We are determined to pay their dues at all costs," al-Sheikh said on Twitter.
The tax transfers make up about half of the PA's budget, according to Palestinian Finance Ministry data.
Israel calls the stipends a "pay for slay" policy and says it encourages violence.
The US Congress passed legislation last year to sharply reduce aid to the PA unless it stopped the payments.
