Ramallah, Dec 18 (IANS): The Palestinian Authority (PA) reached an agreement with the US to address the issue of Palestinian funds detained by Israel, a source said.

According to the official, the agreement outlines a process wherein the Israeli government will check the list of PA's employees in the strip to ensure no Hamas members are included, reports Xinhua news agency.

The source mentioned that the proposal for this agreement came from US National Security Advisor Jake Sullivan, who recently met with Palestinian President Mahmoud Abbas in Ramallah.

Under the agreement, the Israeli government is expected to transfer tax revenues on Palestinian goods through Israeli crossings, in return for a 3 per cent commission in accordance with the economic agreement between Israel and the Palestine Liberation Organization.

Previously, the Israeli government claimed that the PA has been funding Hamas officials in Gaza, thus subtracting the money designated for the territory.

The allegation has been rejected by Ramallah, saying that its payments in Gaza are solely salaries to its employees there.

Under the Oslo Accords, Israel is responsible for collecting customs duties and other tax revenues on behalf of the PA.

Part of the funds go to pay for expenses in Gaza, including the salaries of health workers, that are still covered by the PA even though Hamas controls the blockaded enclave.