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Worn Banknotes, Tobacco Taxes: How Hamas Pays Its Members

Palestinians shop amid the rubble in Khan Younis in southern Gaza, February last year (DPA)
Palestinians shop amid the rubble in Khan Younis in southern Gaza, February last year (DPA)
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Worn Banknotes, Tobacco Taxes: How Hamas Pays Its Members

Palestinians shop amid the rubble in Khan Younis in southern Gaza, February last year (DPA)
Palestinians shop amid the rubble in Khan Younis in southern Gaza, February last year (DPA)

More than two months after a fragile ceasefire between Israel and Hamas took effect in Gaza, the group has steadily reasserted some security control in areas under its authority. Yet for Gaza’s residents, daily economic hardship and deteriorating living conditions show little sign of easing.

Hamas’s popular base, made up of its members, their families, and supporters, remains a key pillar of its strength. Nearly two years of war with Israel have partially disrupted the group’s ability to consistently pay salaries.

During the war, Israel sought to dry up Hamas’s financial network by killing figures responsible for transferring money inside Gaza, as well as raiding currency exchange companies in the occupied West Bank that Israeli authorities said were linked to Palestinian factions.

According to field sources and Hamas officials who spoke to Asharq Al-Awsat, the group faced difficulties and delays in paying salaries regularly at leadership, field and other levels due to security conditions.

It has since resumed partial payments to all its members, including leaders and fighters from the Izz al-Din al-Qassam Brigades, Hamas’s armed wing, while paying lower rates to its preaching and social apparatus, described as civilian elements.

Where does Hamas get its money?

Sources agree that Hamas has managed to preserve some of its financial resources, including commercial activities inside and outside Gaza. One Hamas source said these business revenues generate income for the group alongside funds received from supporting parties such as Iran and others.

They added that such external support fluctuates, sometimes declining, increasing or arriving with delays for reasons related to the donors.

The source said Hamas faces growing difficulties in transferring funds into Gaza, forcing those overseeing salary payments to rely on whatever cash remains accessible in their reserves or to collect revenues from their own commercial sources.

How are salaries paid?

Sources who receive some of these payments told Asharq Al-Awsat, on condition of anonymity, that salaries and stipends were sometimes paid regularly each month but were also delayed by periods ranging from six weeks to two months.

A Hamas source said salary rates varied and did not exceed 80 percent at best, particularly for leaders and operatives in the Qassam Brigades and at the political level.

Lower percentages were paid to the preaching and social apparatus and other bodies, alongside allocations for activities aimed at supporting the population and what the group calls its popular base.

The source said the lowest rates were paid to government employees at both civilian and military levels, reaching 60 percent at most before declining in recent months to around 35 percent.

Several sources said Hamas continues to pay stipends to the families of its members and leaders killed over decades of its activities, as well as to prisoners and wounded fighters.

They added that the group also supports families whose salaries were cut by the Palestinian Authority, continues to provide social assistance and allocates funds to projects aimed at supporting its popular base, including food aid, water provision and communal kitchens, in coordination with foreign institutions.

Asked how salaries are delivered, Hamas sources said payments are made through tight networks and by hand to avoid Israeli monitoring of electronic wallets and banks.

Worn banknotes and tobacco taxes

As Hamas relies on manual delivery, questions remain over how it secures cash under Israel’s blockade. A Hamas source said the process was complex and could not be disclosed for security reasons.

Local sources outside Hamas said the group depends heavily on traders to obtain cash, alongside its existing cash reserves and revenues from businesses it operates.

One source said Hamas often pays worn banknotes to government employees in particular, and to a lesser extent to Qassam fighters and political figures. This forces recipients to manage on their own as most traders refuse to accept damaged or worn currency.

Hamas has encouraged some small traders, especially fruit and vegetable sellers, to accept such notes in exchange for continued support and access to goods at lower prices.

Another source said Hamas has imposed taxes on certain goods, such as tobacco products, to raise funds, noting that most cigarette traders deal in cash rather than electronic wallets, which many Gaza residents now rely on.

Israeli accusations against Iran

On Dec. 7, Israel accused Iran of supporting what it described as a banking network transferring hundreds of thousands of dollars to Hamas. Israel said the network consisted of Gaza-based money changers residing in Türkiye who exploit the country’s financial infrastructure for what it called terrorist purposes.

According to Israel, the network operated in full cooperation with the Iranian regime, transferring funds to Hamas and its leaders and managing wide ranging economic activity involving receiving money from Iran, storing it and transferring it to Hamas via Türkiye.

Israel published the identities of three individuals, including an official in Hamas’s financial apparatus and two money changers from Gaza, claiming they worked under the direction of Khalil al-Hayya.

Sources familiar with the two men told Asharq Al-Awsat they have lived outside Gaza for many years.

One was known to work with various Palestinian factions and had previously smuggled funds for them, including through tunnels along the Egyptian border, while also operating as a businessman in multiple fields beyond currency exchange.

Hamas sources dismissed the accusations as baseless, saying the group has its own methods for transferring funds.

They said Hamas often faces difficulties moving money from abroad into Gaza, a problem that also affects the West Bank due to Israeli pursuit and Palestinian Authority security pressure, though conditions there are better than in Gaza for transferring funds.

Sources from other Palestinian factions said they are also suffering financial crises and difficulties paying salaries and stipends to their members and leaders.

They said they sometimes distribute food aid and other assistance to help their members and families cope with harsh economic conditions, with most of the support coming through institutions backed by Iran or other parties.

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US Pulls Last Aircraft Carrier in Asia as Trump Focuses on Iran and the Western Hemisphere

This handout picture released by the US Navy on May 8, 2019 shows the Nimitz-class aircraft carrier USS Abraham Lincoln (CVN 72) while conducting a replenishment-at-sea with the fast combat support ship USNS Arctic (T-AOE 9), while MH-60S Sea Hawk helicopters assigned to the "Nightdippers" of Helicopter Maritime Strike Squadron (HSM) 5, transfer stores between the ships. (Jason WAITE / Navy Office of Information / AFP)
This handout picture released by the US Navy on May 8, 2019 shows the Nimitz-class aircraft carrier USS Abraham Lincoln (CVN 72) while conducting a replenishment-at-sea with the fast combat support ship USNS Arctic (T-AOE 9), while MH-60S Sea Hawk helicopters assigned to the "Nightdippers" of Helicopter Maritime Strike Squadron (HSM) 5, transfer stores between the ships. (Jason WAITE / Navy Office of Information / AFP)
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US Pulls Last Aircraft Carrier in Asia as Trump Focuses on Iran and the Western Hemisphere

This handout picture released by the US Navy on May 8, 2019 shows the Nimitz-class aircraft carrier USS Abraham Lincoln (CVN 72) while conducting a replenishment-at-sea with the fast combat support ship USNS Arctic (T-AOE 9), while MH-60S Sea Hawk helicopters assigned to the "Nightdippers" of Helicopter Maritime Strike Squadron (HSM) 5, transfer stores between the ships. (Jason WAITE / Navy Office of Information / AFP)
This handout picture released by the US Navy on May 8, 2019 shows the Nimitz-class aircraft carrier USS Abraham Lincoln (CVN 72) while conducting a replenishment-at-sea with the fast combat support ship USNS Arctic (T-AOE 9), while MH-60S Sea Hawk helicopters assigned to the "Nightdippers" of Helicopter Maritime Strike Squadron (HSM) 5, transfer stores between the ships. (Jason WAITE / Navy Office of Information / AFP)

President Donald Trump's war against Iran is stretching the limits of US aircraft carriers and leaving the western Pacific without one of the key American warships as China shows more signs of aggression.

The USS George Washington is departing the Pacific and expected to replace the USS Abraham Lincoln in the Middle East amid growing concerns about mental health and supply issues aboard the long-deployed carrier. The Lincoln has had its time at sea extended from its original May return date to support operations against Iran.

The lack of a US carrier in the Pacific may be short-lived if the Navy deploys another in the next couple of months. But it shows how the open-ended operations with Iran are running some American sailors ragged, analysts say, while the Trump administration further retreats from the Asia-Pacific region and focuses on the Western Hemisphere.

“The administration says that the Pacific is supposed to be the most important behind the Western Hemisphere,” said Greg Poling, director of the Southeast Asia Program at the Center for Strategic and International Studies. Instead, the US is "doing the exact opposite" of its previously expressed goal of pulling out of the Middle East.

American allies in the Pacific are unsettled over the unpredictability of the Republican administration, Poling said, while Beijing “is quite happy with US distraction, with the frustration of US allies and partners."

China may take advantage of US carrier's absence

Beijing sees the US military presence in the region as a threat to China’s rise and an obstacle to its ambition to seize Taiwan, the self-governing island it claims as its own. But the United States has argued that the Pacific region is too important economically to lose.

No one expects China to invade Taiwan because an American aircraft carrier has left the region. But the carrier's absence gives the Chinese another opportunity to show its strength, said Bryan Clark, a former Navy submariner who is a defense analyst at the Hudson Institute.

“They’re using this as part of the narrative to demonstrate to the Philippines, to Japan, to Indonesia and others that the US is not the big dog in the western Pacific anymore,” Clark said. “They would just prefer that countries in the region decide that China is the bigger power and the US is not able to guarantee their security anymore.”

China conducted naval exercises this week with Indonesia and recently has shown signs of aggression toward Japan and the Philippines, two key US allies that also have territorial disputes with Beijing.

China carried out military drills this month near the Scarborough Shoal in the South China Sea. Both China and the Philippines have claims over the shoal. Last month, a Chinese guided-missile destroyer conducted a live-fire exercise off Japan’s southernmost island of Okinotori.

Adm. Frank Bradley, head of the US Special Operations Command, has been trying to reassure regional allies of Washington’s commitment. He was in Manila on Thursday, telling his Filipino counterparts that US special operations forces are ready to step up joint exercises to strengthen the countries' alliance. He also is expected to travel to Japan.

“We have the ability to project force, the United States, anywhere on the globe,” Bradley told The Associated Press. “And when the threat in the region of the Middle East has been attended to, we will redeploy and reorient and be able to project that force wherever else it might be required.”

“I also feel very confident in the Armed Forces of the Philippines’ ability to protect their sovereignty here and for us to remain close with them,” he said.

Evan Sankey, a policy analyst at the Cato Institute who focuses on US policy toward China, said aircraft carriers provide psychological assurance to US allies. The absence of carriers in the region, he said, “adds to the general sense that the US is distracted by events in the Middle East.”

Trump has relied on aircraft carriers for military actions

Trump has relied heavily on aircraft carriers to support military operations during his second term. For example, the USS Gerald R. Ford returned home in mid-May after an 11-month deployment, the longest since the Vietnam War, during which it supported the US fight against Iran and the capture of Venezuela's then-leader, Nicolás Maduro.

The Ford had experienced a fire in a laundry space that forced the carrier to turn around and return to the Mediterranean Sea for repairs and left hundreds of sailors without places to sleep. Meanwhile, the Lincoln has spent a record uninterrupted time at sea of more than 240 days. Democratic lawmakers have been calling for investigations and greater visibility into conditions aboard the ship.

Warships and their crews can only handle so much, said Robert Farley, who teaches national security and diplomacy at the University of Kentucky and often writes about aircraft carriers.

“People don’t get enough rest. It's psychologically exhausting. And R&R is part of keeping the crew healthy,” Farley said. “Sometimes it’s framed as, ‘These people haven’t had a vacation.’ But we are dealing with well-known limits on the capacity of a crew to operate at top efficiency over time. And that just declines."

Clark, of the Hudson Institute, said the squeeze on the nation's aircraft carriers stems from the lack of preparation and planning for the Iran war.

“If we were going to mobilize to do this kind of conflict, and we anticipated it might go this long, we might have done some changes to the carrier schedule to make sure more would be available,” Clark said.

Clark said the Navy has 11 aircraft carriers and typically deploys two or three at a time. But it could soon deploy four if the USS Theodore Roosevelt leaves San Diego for the Middle East, allowing the Washington to return to Pacific.

But the massive warships will need maintenance, likely causing a bottleneck at the nation's only two carrier shipyards.

“We’ll end up with a maintenance debt that needs to be paid for the next few years,” Clark said. “We’ll probably have less carrier presence than we’ve had in the previous years because carriers will be lined up to get into the shipyard.”

There are questions about the use of aircraft carriers in modern warfare

Michael Swaine, a senior research fellow in the Quincy Institute’s East Asia Program, questions the future need for aircraft carriers as warfare rapidly changes.

Carriers can be more easily targeted with drones and missiles, particularly by an adversary such as China, Swaine said, while smaller ships and submarines can be as effective in striking targets as the fighter jets that launch off a carrier.

Top Navy officials have indicated a desire to move away from a heavy reliance on carriers. Adm. Daryl Caudle, chief of naval operations, told The Associated Press in February that he wants to convince commanders to use smaller, newer ships and other assets instead of consistently turning to huge aircraft carriers.

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Palestinians Besieged in West Bank Village Fear Israeli Settlers will Seize Their Homes

CCTV footage shows, as witnesses say, Jewish settlers throwing rocks on the road in Qusra, in the Israeli-occupied West Bank, August 12, 2026 in this screengrab taken from a handout video- REUTERS
CCTV footage shows, as witnesses say, Jewish settlers throwing rocks on the road in Qusra, in the Israeli-occupied West Bank, August 12, 2026 in this screengrab taken from a handout video- REUTERS
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Palestinians Besieged in West Bank Village Fear Israeli Settlers will Seize Their Homes

CCTV footage shows, as witnesses say, Jewish settlers throwing rocks on the road in Qusra, in the Israeli-occupied West Bank, August 12, 2026 in this screengrab taken from a handout video- REUTERS
CCTV footage shows, as witnesses say, Jewish settlers throwing rocks on the road in Qusra, in the Israeli-occupied West Bank, August 12, 2026 in this screengrab taken from a handout video- REUTERS

From inside his home in the West Bank town of Qusra, Qusai Abu Rida watched on Friday as Israeli settlers moved from where they had erected a tent in front of his house to the valley below, rather than returning to the nearby outpost where they live.

Even as the army took positions around him and the homes of two other families that settlers had blockaded for most of this week, the settlers remained close enough that Abu Rida feared they would again return after the army left and try to take over the home owned by his Palestinian American brother in Ohio.

“I just don’t know when this will end,” he said.

The standoff in Qusra entered a new stage Friday as activists marched toward the besieged homes to try and replenish the families' food and water supply. But Abu Rida said he was growing tired of the pattern, with Israeli forces removing the settlers, only for them to return and reestablish their positions after the troops withdrew.

“It’s like a kids’ game, like cat and mouse,” Ziv Stahl, the executive director of the Israeli rights group Yesh Din, said. “It’s clearly not a matter of capability but a matter of will.”

The siege of the homes is the latest episode in a wave of settler violence convulsing the occupied West Bank, which Israel seized in the 1967 Mideast war and which would make up the main part of a future Palestinian state. Israel's military said the village — roughly 10 miles (16 kilometers) from the Palestinian city of Nablus — was a closed military zone.

They did not answer questions about the presence of the settlers. Both Israel’s military and Israel’s police both referred questions arrests in Qusra to the other.

The West Bank has become more dangerous for Palestinians as Israel, under Prime Minister Benjamin Netanyahu, has approved more than 100 new settlements. Extremist settlers routinely enter Palestinian towns, clashing with villagers, burning homes, mosques and cars.

Netanyahu is courting blocs of ultranationalist voters ahead of what’s expected to be a difficult reelection campaign in October. He and members of his cabinet have largely dismissed concerns about settler violence as overblown and attributed it to fringe groups of a few hundred youths. Yet rights groups and Palestinians say the government's policies have made it more difficult to restrain settlers, who are rarely punished for attacks.

The standoff in Qusra began on Sunday when dozens of settlers arrived and blocked the doors to the three houses, preventing occupants from leaving, according to the families inside.

Israeli troops intervened multiple times and arrived in large numbers Thursday.

Abu Rida and his teenage son were temporarily moved by the army on Thursday but allowed to return hours later. He told his brother in Ohio that he planned on staying to defend the home.

For many, the scene unfolding in Qusra — now in its sixth day — reflected broader failures by Israeli authorities to curb the violence in the West Bank.

Itamar Weil, an Israeli human rights activist from the group Bnei Avraham, said the army had threatened to use tear gas against the activists and forced them to leave, even as settlers remained in the valley below Qusra.

“The army used to prevent settlers from carrying out this kind of violence,” he said. “Now, with a government that fully supports them, they’re not doing their job. They should be protecting both sides from violence, but instead they’re removing activists while barely doing anything about the settlers.”

Palestinian officials have reported 1,476 attacks by Israeli settlers in 2026, including several earlier instances in which settlers staged takeovers of Palestinian homes on the outskirts of other West Bank towns.

A total of 87 Palestinians have been killed by Israeli settlers and soldiers in the West Bank this year, according to the Palestinian Authority’s Health Ministry. Israel says some were involved in terrorism, which it defines broadly to include militancy and rock-throwing. Three Israelis were killed by Palestinians, including two in a July clash during which four Palestinians were also killed.

Katz strips army of enforcement power against settlers Before calm was restored in Qusra, Israeli Defense Minister Israel Katz announced on Friday that he would transfer all enforcement powers against Israeli civilians in the West Bank from the army to Israel’s police.

“The (Israeli military’s) role is to fight Palestinian terrorism, focus on protecting the borders and settlements against threats, deal with the borders and the territory itself and security threats to the settlements and the State of Israel, and not chase after boys on the hills,” Katz said in a statement.

Historically, the army has been able to arrest Palestinians and bring those accused of crimes before military courts. But when it comes to Israeli civilians, in most circumstances it can only use temporary detention for those suspected of crimes, leaving arrests, investigations and prosecutions to police and civilian courts.

Katz’s move comes after he ended the use of administrative detention against Israeli civilians in November 2024. The military had used the policy as a tool to contain settler violence, allowing it to detain suspects without charge and remove them from the West Bank.

Much like with that move, rights groups said transferring all powers to the police was unlikely to restore order or ensure Palestinian safety.

Some 2.8 million Palestinians live under Israeli military rule in the West Bank alongside more than 560,000 Israeli civilians who live in settlements that the international community largely considers illegal and an obstacle to peace.

Though the Palestinian Authority exercises limited autonomy and policing power in the territory’s largest cities, agreements that date back to the 1990s give Israel security control over large swaths of the territory, including agricultural areas and communities such as Qusra.

Stahl, Yesh Din's executive director, said Katz's announcement wouldn't change or help stem the violence because police will still require army escorts to operate in Palestinian areas.

“Unless (Katz) means he’s going to apply Israeli law and have the police control the West Bank, the military is still the main body in charge,” she said.

Features

Why is North Korea Ramping Up Criticism of Japan?

News coverage showing file footage of a North Korean missile launch is seen on a screen at Seoul Station in Seoul on August 12, 2026. (Photo by GREG BAKER / AFP)
News coverage showing file footage of a North Korean missile launch is seen on a screen at Seoul Station in Seoul on August 12, 2026. (Photo by GREG BAKER / AFP)
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Why is North Korea Ramping Up Criticism of Japan?

News coverage showing file footage of a North Korean missile launch is seen on a screen at Seoul Station in Seoul on August 12, 2026. (Photo by GREG BAKER / AFP)
News coverage showing file footage of a North Korean missile launch is seen on a screen at Seoul Station in Seoul on August 12, 2026. (Photo by GREG BAKER / AFP)

North Korea has stepped up a campaign of rhetoric against Japan's military ‌buildup and its security ties with the United States and South Korea, saying they threaten regional stability. The criticism in more than a dozen state media attacks since early July has coincided with an unusual silence over the North's own missile launches, raising questions about Pyongyang's broader strategic messaging, according to Reuters.

WHY IS NORTH KOREA TALKING MORE ABOUT JAPAN?

North Korean statements have targeted Japan's acquisition of counter-strike capabilities, testing of a US-made Tomahawk cruise missile, rising defense spending and Tokyo's annual defense white paper.

Last week, Kim Yo Jong, the influential sister of leader Kim Jong Un, warned of "additional military options" in response to what she described as Japan's transformation into a military power. On Tuesday, a KCNA commentary described Japan's 2026 defense white paper as a "re-invasion-minded" document aimed at justifying military expansion.

The latest broadside came on Friday, when North Korea criticized annual US-South Korean Ulchi Freedom Shield military drills and accused US-Japan-South Korea military cooperation of evolving into a "nuclear alliance". Washington and Seoul say the drills are defensive.

Another KCNA commentary accused Washington of pursuing a strategy that lowers the threshold for nuclear weapons use and cited US extended deterrence commitments to South Korea and Japan.

HOW HAS ‌JAPAN CHANGED ITS ‌DEFENCE STANCE?

Japan in 2022 announced plans to double defense spending to 2% of GDP to ‌counter ⁠growing security threats ⁠from China, Russia and North Korea.

A major part of that expansion includes spending on long-range missiles such as the US-made Tomahawk, which can strike targets more than 1,000 km (621 miles) away. Prime Minister Sanae Takaichi’s government is expected this year to revise Japan’s national security strategy, a move some analysts will likely lead to further increases in defense spending, including on drones and arms production.

IS THIS REALLY ABOUT JAPAN?

Analysts say Japan is only part of the story.

Park Won-gon, a professor at Seoul's Ewha Womans University, said the primary goal is to frame Northeast Asia as a contest between rival camps.

"The biggest objective is to create a US-South Korea-Japan versus North Korea-China-Russia framework," Park said.

He said Pyongyang wants stronger backing ⁠from Beijing and Moscow to cement its escape from diplomatic isolation and to bolster arguments that its ‌nuclear arsenal is necessary.

South Korea's Unification Ministry expressed a similar view on Thursday after ‌North Korean First Vice Foreign Minister Jang Kum-chol criticized Seoul's plans to acquire nuclear-powered submarines and accused South Korea, the United States and Japan of ‌preparing a "second AUKUS" in Northeast Asia. The ministry said North Korea appears to view South Korea's submarine plans, Japan's evolving security posture ‌and trilateral military cooperation as threats to the regional balance of power, as it increasingly aligns itself with China and Russia. Kyungnam University professor of North Korean studies Lim Eul-chul said North Korea's messaging increasingly mirrors China's concerns about Japan's military expansion.

WHY IS NORTH KOREA STAYING SILENT ABOUT ITS MISSILE TESTS?

The heightened rhetoric has coincided with unusual silence on North Korea's recent missile launches, which were condemned by South Korea, Japan and the United States.

Despite conducting ‌ballistic missile tests last week and again this week, state media has yet to report either, departing from its usual pattern of publicizing tests within a day.

Analysts say the launches may ⁠have involved upgrades to existing missile ⁠systems rather than new weapons, reducing their propaganda value. Shin Jong-woo of the Korea Defense and Security Forum said the tests may have involved improved short-range ballistic missiles developed with Russian technical assistance and potentially destined for Russia.

Kim Yong-hyun, a professor at Dongguk University, said North Korea may be avoiding publicity if launches are connected to prospective military exports.

WHAT DOES RUSSIA HAVE TO DO WITH IT?

North Korea's growing military cooperation with Russia has become a central factor in assessments of its weapons programs. Ukrainian President Volodymyr Zelenskiy has repeatedly said Russia continues to use North Korean missiles against Ukraine and has accused Pyongyang of providing Moscow with missiles, ammunition and a further promise of troops for the war effort.

Analysts say battlefield feedback and Russian assistance may have helped North Korea improve the accuracy and performance of some missile systems.

Shin said recent launches could have been tests of upgraded variants before deployment or export.

WHAT IS NORTH KOREA TRYING TO ACHIEVE?

Analysts say North Korea is seeking to cast the region in terms of competing blocs, with Pyongyang, Beijing and Moscow on one side and Washington, Seoul and Tokyo on the other.

Portraying US-South Korea-Japan cooperation as an increasingly threatening military and nuclear alliance helps Pyongyang justify its weapons programs, bolster Chinese and Russian backing and argue that its nuclear arsenal is a necessary response to a worsening security environment, they say.