The financial mechanism behind Hamas missiles: Customs duties on PlayStation and high real estate taxes

Over the years the organization has built its military strength, but also its economic resilience. With a sophisticated taxation mechanism and ongoing funding from the Iranian authorities – this is exactly how it works.

In recent years, since the end of Operation “Eitan Cliff”, various security forces have warned of the silent and deadly intensification of the Hamas terrorist organization – the construction of a military force whose dire consequences we are currently witnessing in the face of the missile attack on Israel in the current round.

Only last August did the chairman of Yisrael Beiteinu Party, Avigdor Lieberman, warn that “the intensification of Hamas in the past year is unprecedented.” In a survey conducted by GSS chief Nadav Argaman, he warned that “Hamas is building an outpost in Lebanon under the auspices of Iran” and that the murderous terrorist organization is investing a lot of resources in building its military might for the next campaign against Israel, by deepening its strategic ties with Iran.


A well-oiled smooth financial mechanism

Behind Hamas’ military intensification mechanism is a well-oiled financial mechanism that funds all of the terrorist organization’s militant activities. Iran, according to the well-founded assessment of many intelligence and security sources, is the main supporter of ‘Izz-a-Din al-Aksem’, the military arm of Hamas, and it does so by injecting hundreds of millions of dollars annually.

In the past year, the Ayatollahs’ government has significantly increased its financial support for the terrorist organization, and from an annual budget estimated at $ 100 million, funding has jumped to more than $ 350 million a year.

Unsurprisingly, the extremist Shiite state is also the largest sponsor of the second-largest terrorist organization in the Gaza Strip – Islamic Jihad, with an estimated $ 100 million a year.

Iran, as mentioned, is the main financier of Hamas’ militant activities, but not the only one. Hamas itself, as GSS chief Argaman has repeatedly pointed out, directs a large portion of its independent financial resources to terrorist purposes – such as building the missile array and attack tunnels – at the expense of investing in improving the difficult situation of the Gazans. Ironically, the terrorist organization draws its financial sources from the same population it has controlled since its takeover of the Gaza Strip in 2007.


The third richest terrorist organization in the world

In a special international investigation by Forbes Israel, which ranked the richest terrorist organizations in the world, Hamas was ranked third with revenues of about $ 700 million a year.

Despite the catastrophic situation of the residents of the Gaza Strip and despite the collapsing economy, Hamas manages to generate many sources of funding from the poor and deprived population of Gaza and sweeps tens of millions of dollars into its coffers every month. As the sole governmental authority, the organization imposes various taxes and levies on consumer goods and commodities entering the Strip, such as cigarettes, fuel and vehicles, and collects licensing fees on vehicles, motorcycles and even on carts.

On cigarettes, for example, Hamas has a customs duty of up to 50% and is estimated to yield close to $ 10 million a month. Importers of goods are charged NIS 50 for each electrical product, NIS 100 on average for each ton of fruit and vegetables and up to NIS 300 for importing toys.

Every truck out of Salah-a-Din Road, a major transportation artery in the Gaza Strip, is subject to a NIS 100 tax. There is a payment of NIS 300 for moving a suitcase in one of the illegal tunnels that are still active on the Egyptian-Gaza border, and for importing furniture from Israel, a “customs” tariff of no less than NIS 700 has been set. Hamas also has a real estate authority, which levies a purchase tax of 17% on every real estate transaction carried out under its jurisdiction.


Operation of a branched tax authority

The ramified tax network spun by Hamas is also sweeping large chunks of the capital flowing into Gaza as humanitarian aid – mainly with Qatari funding which is estimated to reach $ 200 million a year. For example, the organization collects tax on exchange companies, which convert the foreign money that goes into shekels, and pockets tens of millions. Hamas also runs hundreds of businesses, and its business activities cover a variety of areas, from businesses in the real estate and insurance industry, through banking businesses to businesses in the hotel and tourism industries.

The plight of Palestinians living in Gaza is not a consideration in Hamas’ system of interests – on the contrary. Quite ironically and cynically in recent years, and despite the growing distress of its subordinates, Hamas has raised taxes and specifically included the collection mechanisms, which now also include $ 1,000 a year in taxes imposed on businesses operating in the Strip – cafes, restaurants or hotels for example.

In recent years, Hamas’ revenues have jumped from taxes, and according to data from the Coordinator of Operations in the Territories, it produces tens of millions of dollars in taxes each month alone, accumulating to hundreds of millions of dollars a year.


By Itay Zehorai, May 12, 2021, published on Forbes Israel (Hebrew)
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