Israeli Prime Minister Benjamin Netanyahu. AP
Israeli Prime Minister Benjamin Netanyahu. AP
Israeli Prime Minister Benjamin Netanyahu. AP
Israeli Prime Minister Benjamin Netanyahu. AP

How Israeli political wrangling hindered Gaza ceasefire approval


Thomas Helm
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Live updates: Follow the latest on Israel-Gaza

The future of the ceasefire deal between Israel and Hamas was thrown into question on Wednesday after a day of political chaos in Israel that threatened to derail months of international diplomacy to release hostages and end the war in Gaza.

Optimism that an end to the war was close surged on Wednesday after Israel and Hamas agreed to the deal, in news that was welcomed internationally as a key moment in closing one of the most dangerous chapters in the recent history of the Middle East, which has stood on the brink of regional war for 15 months.

Israel’s security cabinet was reportedly scheduled to meet at 11am on Thursday to agree on implementing the deal, for which Prime Minister Benjamin Netanyahu was widely thought to have gained the political backing. Instead, the morning began with a worrying series of domestic political developments inside Israel that steadily raised fears that the agreement was hanging by a thread.

Mr Netanyahu’s office first accused Hamas of creating a “last-minute crisis” to prevent the deal. The statement then said that the claimed stumbling block meant “Israel will not set a date for a cabinet and government meeting until the mediators announce that Hamas has approved all the details of the agreement”. Hamas political bureau member Sami Abu Zuhri, meanwhile, said there was "no basis" for Israel's accusations.

A crucial far-right faction in Mr Netanyahu’s coalition, political party Religious Zionism, then said it would leave the government if Israel did not return to full-fledged war in Gaza after the first phase of the three-stage ceasefire concluded.

“Alongside the longing for the return of all our abductees, the Religious Zionist faction strongly opposes the deal,” a statement from the party said, adding that a return to war was “a condition for the party to remain in the government and coalition”. Far-right National Security Minister Itamar Ben-Gvir has also threatened to quit.

That means two of the 11 Security cabinet members have publicly come out against the deal. If passed by the highest-level body, the larger, 34-member cabinet will vote on the ceasefire.

Despite the drama, departing US Secretary of State Antony Blinken said on Thursday that he had no reason to doubt the Gaza ceasefire and hostage release deal would take effect on Sunday.

“I am confident and very fully expect that the implementation will begin as we said on Sunday,” Mr Blinken said in his final media briefing at the State Department. “I’ve been on the phone one way or another all morning with [special envoy] Brett McGurk with our Qatari friends, and I’m very confident that this is moving forward, and we’ll see the start of the implementation of the event on Sunday.”

Mr Netanyahu's coalition controls the Knesset, Israel's parliament, with a 64-seat majority. His party, Likud, has 32 seats in the 120-member house, far-right Finance Minister Bezalel Smotrich's Religious Zionism holds seven and Mr Ben-Gvir's Jewish Power holds six.

Israeli pollster and commentator Dahlia Scheindlin told The National that she believes Religious Zionism’s threat should be taken seriously because leader Mr Smotrichhopes Netanyahu will cave because he is showing extremely erratic behaviour and clearly able to be pressured”.

Ms Scheindlin said she thinks “[Netanyahu’s] erratic behaviour and very weird messages are an 'episode’ he’s having. He’s had these in the past, where he becomes paralysed and self-contradictory”.

“It seems to me that he is simply unable to shake his political calculations, which have generally been more important than anything regarding ending the war or getting the hostages back.”

An Israeli source told The National on Thursday evening that the cabinet meeting had been moved to Friday, but it was not immediately clear whether difficulties in the cabinet had been resolved.

The current deal is set to unfold in three stages. The first would see the release of 33 Israeli hostages in exchange for Palestinian detainees in Israeli prisons. Israel’s military would also withdraw to agreed areas away from urban centres in Gaza and the delivery of humanitarian supplies in the strip would significantly increase. Negotiations over a second phase of the agreement would begin by the 16th day of the first phase.

While polling shows that a significant majority of Israelis want the country to give top priority to releasing hostages in Gaza, there has been vocal opposition to a deal from the far-right, many of whom believe exchanging hostages for Palestinian detainees endangers national security, a charge led by Mr Ben-Gvir, who has called on political allies to leave the government if the deal is passed.

Israel waited on tenterhooks for reports that a new cabinet meeting to approve a deal had been set, amid Religious Zionism’s threats. An Israeli official told The National late on Thursday afternoon that Mr Netanyahu was yet to respond to Religious Zionism’s demand.

Any delay brings the fragile diplomatic process dangerously close to Sunday, the day it is scheduled to take effect, subject to the approval of the Israeli cabinet.

Israel launched its campaign in Gaza after Hamas-led gunmen burst into Israeli border-area communities on October 7, 2023, killing 1,200 people and abducting more than 240 hostages, according to Israeli tallies.

If successful, the ceasefire would halt fighting that has razed much of heavily urbanised Gaza, killed more than 46,700 people, and displaced most of the tiny enclave's pre-war population of 2.3 million, according to Gaza authorities.

Willy Lowry contributed to this report from Washington

UAE currency: the story behind the money in your pockets
Real estate tokenisation project

Dubai launched the pilot phase of its real estate tokenisation project last month.

The initiative focuses on converting real estate assets into digital tokens recorded on blockchain technology and helps in streamlining the process of buying, selling and investing, the Dubai Land Department said.

Dubai’s real estate tokenisation market is projected to reach Dh60 billion ($16.33 billion) by 2033, representing 7 per cent of the emirate’s total property transactions, according to the DLD.

Ten tax points to be aware of in 2026

1. Domestic VAT refund amendments: request your refund within five years

If a business does not apply for the refund on time, they lose their credit.

2. E-invoicing in the UAE

Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption. 

3. More tax audits

Tax authorities are increasingly using data already available across multiple filings to identify audit risks. 

4. More beneficial VAT and excise tax penalty regime

Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.

5. Greater emphasis on statutory audit

There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.

6. Further transfer pricing enforcement

Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes. 

7. Limited time periods for audits

Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion. 

8. Pillar 2 implementation 

Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.

9. Reduced compliance obligations for imported goods and services

Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations. 

10. Substance and CbC reporting focus

Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity. 

Contributed by Thomas Vanhee and Hend Rashwan, Aurifer

Other workplace saving schemes
  • The UAE government announced a retirement savings plan for private and free zone sector employees in 2023.
  • Dubai’s savings retirement scheme for foreign employees working in the emirate’s government and public sector came into effect in 2022.
  • National Bonds unveiled a Golden Pension Scheme in 2022 to help private-sector foreign employees with their financial planning.
  • In April 2021, Hayah Insurance unveiled a workplace savings plan to help UAE employees save for their retirement.
  • Lunate, an Abu Dhabi-based investment manager, has launched a fund that will allow UAE private companies to offer employees investment returns on end-of-service benefits.
Updated: January 17, 2025, 7:39 AM