A senior Israeli governmental source reported on Sunday that Israel decided not to transfer the tax revenues of the past month earmarked for the Palestinian Authority, Israeli online daily Haaretz reported.The Palestinian Authority was due to receive a total of NIS 200 million this Wednesday for the month of January, but Israel decided not to transfer the money after Hamas’ victory in the Palestinian legislative council elections last week.

The Israeli source added that the government has yet to decide if it will permanently freeze all money transfers; the Israeli government is not expected to make a final decision regarding this issue this week.

Meanwhile, Israeli Defense Minister Shaul Mofaz and the security establishment expressed support to the money transfer fearing that the P.A will collapse and will not be able to provide daily services, which will in return force Israel to deal with those matters.

Yet, other senior Israeli officials believe that Israel should not show any soft stance, adding that if Israel carries the transfer, other countries will do the same.

The Israeli acting prime minister, Ehud Olmert, said that Israel does not intend to transfer  money “which will be used for terrorism”. The statements of Olmert came during a joint press conference with the German Chancellor, Angela Merkel.

A senior diplomatic source in Israel reported that Israel is not obliged to transfer the money to the P.A since it agreed to transfer the tax money to the former finance minister Salam Fayyad, “but now after Fayyad resigned, the agreement is not valid”, according to the source.

Also, Benjamin Netanyahu, head of the Likud party,  said that the money should not be transferred to the P.A, and called for immediate halt of money transfer “for Hamas”.   

Member of Knesset, Silvan Shalom, said that if Israel transfers the money to Hamas, the United States will have no reason not to do the same, adding that this money will “fund a Palestinian army which will fight Israel”.