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The Palestinian Authority has demanded that Russia resolve the terror-payment crisis that could lead to the PA’s collapse as it rejected a European Union compromise solution.“There have been attempts to find alternative channels to pay the prisoners and martyrs allowances, which we will not accept,” PA Deputy Prime Minister and Minister of Information Nabil Abu Rudaineh said on Thursday.To protest Israel’s withholding of taxes equal to the sum of money that the PA uses to pay terrorists and their families, the PA has refused to accept any of its tax revenues, a move which many believe could lead to its financial collapse. According to the UN, tax revenues make up 65% of the PA’s budget.The Palestinian Authority had hoped the EU would support its policy of providing merit-based payments to security prisoners. Instead, it suggested that a compromise position would be placing the Palestinian prisoners on the social welfare roll, where money would be provided on a needs-based system.Abu Rudaineh said that the PA rejected the EU proposal.On Thursday, PA President Mahmoud Abbas met with head of the Russian Representative Office in Ramallah Aganin Rashidovich and discussed with him the crisis surrounding the deduction of payments to the families of the prisoners and “martyrs.”Abbas demanded that Russia intervene with Israel to halt the deductions, and warned that the PA was facing a sharp financial crisis as a result of the Israeli measure, a PA official told The Jerusalem Post.“Israel must pay the whole funds without any deductions,” Abu Rudaineh said, adding that Israel “must honor all agreements and pay the funds in full.”On Thursday, Israel’s public broadcaster KAN reported that the PA has returned to Israel the tax and tariff revenues that it had received at the beginning of the week, in the amount of NIS 500 million. Palestinian officials said that this was the third time the PA has refused to accept the funds from Israel since the beginning of the year.In Brussels on Tuesday, the 15 member Ad Hoc Liaison Committee – which includes representation from the US, the EU and the United Nations – attempted to find a way out of the financial impasse between the Israelis and the Palestinians. Representatives from both Israel and the PA were at the meeting.Although the EU often sees eye-to-eye with the Palestinians, it took a strong stand against the terror payments.EU Commissioner for the European Neighborhood and Enlargement Negotiations Johannes Hahn told the gathering: “We do not support the system of Palestinian payments to ‘prisoners and martyrs.”He suggested a compromise move to a needs-based system, saying that the EU was “ready to work with the Palestinian Authority to see how beneficiaries of the current scheme could be integrated – on the basis of need rather than any other criteria – into the PA’s regular social allowance system.”The EU delegation further clarified the EU’s position.“Commissioner Hahn clearly stated that the EU does not support the system of Palestinian payments to the so called “prisoners and martyrs” and the EU is not and will not contribute to such payments,” the delegation said.“We are ready to work with the Palestinian Authority to see how the PA’s regular social allowance system can be extended to cover anyone in need on the basis of social criteria only,” according to the delegation. “Any other interpretation is not based on facts.”“At the same time, we are seriously concerned by the fiscal crisis faced by the PA. We called on Israel to comply with its current obligations and resume full transfer of revenues – and on the PA to accept the transfers,” the EU delegation said.