RAMALLAH: Israel has decided to confiscate tax revenues it is legally obliged to transfer to the Palestinian Authority (PA) in retaliation for Palestine's United Nations upgrade to nonmember observer state last Thursday, Israeli and Palestinian sources reported on Sunday. The 120 million USD will be used to pay PA debts to the Israeli Electric Company, which West Bank cities and villages are obliged to obtain their electricity from due to agreements between the PA and Israel, Israeli news agency Haaretz said. While Israeli officials openly debated how to respond to the UN bid weeks earlier, Israeli Foreign Minister Avigdor Liebermann suggested toppling the Ramallah-based Palestinian government, presently presided over by Mahmoud Abbas. While attempting to mitigate the recent Israel-Gaza conflict, US Secretary of State Hillary Clinton urged Israel not to punish the PA in response to its efforts to seek international recognition in the United Nations General Assembly (UNGA). Israeli officials, however, announced on Friday, the day after the UNGA voted 138-9 in favor of a Palestinian state, plans to build an additional 3,000 homes in East Jerusalem and the occupied West Bank. Under international law, all settlements are considered illegal. Haaretz also added that Israeli ministers attending a weekly cabinet meeting voted unanimously to reject the United Nations upgrade of Palestine because West Bank is a “disputed territory" over which “the Jewish people have a natural right."