Israel plans to use tax revenue it collects on behalf of the Palestinian Authority (PA) to pay the PA’s nearly 2 billion shekel ($544 million) debt to state-run Israel Electric Co (IEC), Finance Minister Bezalel Smotrich has said, Reuters reports.

Since the Hamas-led attack on Israel on October 7, 2023, Smotrich has withheld sums earmarked for administration expenses in Gaza.

Those frozen funds are held in Norway and, he said at Sunday’s cabinet meeting, would instead be used to pay debt owed to the IEC of 1.9 billion shekels.

“The procedure was implemented after several anti-Israeli actions and included Norway’s unilateral recognition of a Palestinian state,” Smotrich told cabinet ministers.

“The PA’s debt to IEC resulted in high loans and interest rates, as well as damage to IEC’s credit, which were ultimately rolled over to the citizens of Israel.”