The United States has opposed Israel's decision to freeze the transfer of tax revenues to the Palestinian Authority in response of its application to join the International Criminal Court (ICC), Press TV reported.
"This step is one that raises tensions as others do," US State Department spokeswoman Jen Psaki said on Monday, referring to the freeze on revenue transfers to the Palestinian Authority.
"What we are trying to avoid here is a back and forth tit-for-tat," she added.
According to an Israeli official, Tel Aviv has blocked the transfer of taxes it collects on behalf of Palestinians in retaliation for their ICC bid.
"The funds for the month of December were due to pass on Friday, but it was decided to halt the transfer as part of the response to the Palestinian move," the Israeli daily Haaretz quoted an unidentified Israeli official as saying.
The official went on to say the halting involves 127 million dollars worth of value-added tax (VAT) and customs duties on Palestinian goods that pass through Israel.
On Wednesday, Palestinian President Mahmoud Abbas signed the documents required for Palestine to join 20 international organizations, including the ICC.
Abbas signed the request to join the ICC after the United Nations Security Council rejected a Palestinian proposal for statehood on last Tuesday.
In 2012, following Palestine's wining of a UN vote acknowledging it as a non-member state, Tel Aviv again delayed payments to the Palestinians.
After foreign aid is deducted, tax revenues account for around two-thirds of the Palestinian Authority's yearly budget.