The United States welcomes the understanding on tax revenue collection between the Palestinian Authority and the Government of Israel. This is significant for both parties: it should facilitate the flow of goods between Israel and the Palestinian Authority, reduce smuggling, and increase tax revenues to be shared by both parties. It should also demonstrate the very practical value of the results of talks between the two parties. Even as we encourage the parties to return to negotiations aimed at agreement on a two-state solution, none of us should lose sight of the value of pursuing practical measures that improve the daily lives of Palestinians as well as Israelis.

Solving the financial and economic difficulties facing the Palestinian Authority and ensuring the viability of the Palestinian economy are necessary for a future Palestinian state, and are in the interests of the parties, the United States, and the entire international community. It is also valuable to facilitate Israeli authorities’ efforts to implement improved customs and other tax procedures.