A pledge to reverse recent tax increases has not appeased protesters in Ramallah, who are angry despite the concession from the Palestinian Authority.
The demonstrators are mainly public sector workers who have not received the whole of their salaries for August because the government is running low on cash.
Palestinian Prime Minister Salam Fayyad has promised to save money in other areas
“Until we overcome the economic crisis, we will stop our commitments to any new expenses that have to do with travel, rent or management – mainly those related to fuel and travel in all official offices.
“VAT will be reduced and put back to 15 percent. This is the minimum allowed right now. The cut will be affective from October 1, 2012,” Fayyad announced.
However, the Prime Minister’s solutions are not satisfying many Palestinians, and the head of the public transport union says he will organise more protests.
The Palestinian economy is reliant on foreign aid, which has slow down recently.
In addition, some taxes are pegged to high Israeli rates because of economic agreements between the two.