Hamas Corruption Weighs Heavily on Gaza
Hamas Corruption Weighs Heavily on Gaza
Recently, an official of the Finance Ministry in the Hamas-controlled Gaza Strip announced that since 2006 the office had not received a single report of corruption. Whether or not this is true, the fact is that Hamas corruption is not only pervasive in Gaza, it has also been detrimental to the greater social and economic good.
The principal vehicle of Hamas corruption is excessive taxation. One of Gaza’s biggest revenue cows, tunnel smuggling into Egypt’s Sinai Peninsula, has borne the brunt of this graft. For the over 1,200 tunnels, tariffs of up to 15 percent are imposed on the thousands of tons of goods being brought in daily. Yet most are collected off the books, and of the 2,400 near-millionaires in Gaza, most are Hamas affiliates responsible for monitoring tunnels, according to Palestinian Authority officials. This is why when private tunnels began drawing business away from tunnels run by those close to Hamas, the movement declared them illegal, and implemented a mandatory $3,000 license to continue operation.
Excessive levels of taxation and licensing are not unfamiliar to Gazans. The Peace Research Institute Oslo reports that in the last six years municipality taxes in Gaza have quadrupled, reaching up to 60-70 percent. Fees on birth certificates have been instituted, and vocational licenses have become mandatory for all small business owners. Water, electricity, and other basic goods also continue to be taxed.
So when Palestinian parliamentarian Jamal Nasser claimed that of the $540 million in spending in Hamas’ 2010 budget, only $60 million would come from taxation, analysts raised red flags. Unfortunately, taxation is only a part of the story of Hamas corruption.
Fraud is just as prevalent in Hamas institutions. One of the main avenues for financial assistance to Gazans, personal finance programs offered by banks, is entirely run and regulated by the Palestinian Monetary Authority in Ramallah. In fact, the authority has barred these banks from doing business with Hamas. Nevertheless, Hamas officially takes full credit and responsibility for these important services, according to various intelligence sources.