Palestinian Finance Minister, Estefan Salama, has issued a stark warning that the Palestinian Authority is facing its most severe financial crisis since its establishment, with 2026 expected to be the toughest year in its economic history. The crisis has been exacerbated by Israel's continued delays in transferring tax refunds that it collects on behalf of the Palestinian Authority, crucial for the management of public worker salaries. Salama announced that the government would only be able to pay 60% of the public sector salaries for October, which further indicates the precarious financial situation.

During a press conference held in Ramallah, Salama highlighted that the government's monthly revenue from local sources is approximately 400 million shekels, while it requires at least one billion shekels to cover basic operational expenses. This deficit in finances severely limits the government's capabilities in meeting its commitments and has created anxiety among public workers who are uncertain about their salaries for November and December.

The implications of this financial turmoil extend beyond just immediate salary payments; they could lead to wider socio-economic instability. The reliance on Israeli tax transfers and the ongoing economic conditions pose significant challenges for the Palestinian leadership, raising concerns about governance and service provision. As the economic situation continues to deteriorate, the potential for unrest and calls for solutions from the international community may increase, highlighting the urgent need for resolution and support to stabilize the situation.