Palestinian Authority suspends plans to raise taxes

The Palestinian Authority announced on Sunday it was suspending plans to raise income tax that have sparked widespread protests but said it was still seeking ways to cut costs in 2012 to plug a gap resulting from lower-than-expected foreign aid revenues.

Prime Minister Salam Fayyad said earlier this month that the Palestinian Authority was planning to double the income tax rate to 30 percent as part of efforts to cut the budget deficit to $750 million in 2012, from $1.1 billion a year earlier. (Reuters)