RAMALLAH, June 6 (Xinhua) -- Palestinian Prime Minister Mohammed Ishtaye said on Thursday that an Israeli financial war on the Palestinians has placed the Palestinian Authority in a very difficult situation.

"The situation is difficult and this financial pressure is part of the financial war that Israel is waging against us," Ishtaye said in a televised address to the Palestinian people.

"The goal of this war is to force us to surrender, be defeated and accept the U.S. 'Deal of the Century' plan," he added.

The Palestinian prime minister said the current financial crisis resulted from Israeli cut of the Palestinian tax revenues used to support the families of the prisoners and those killed in conflict with Israeli soldiers.

He revealed that July and August would be the most difficult months for the Palestinian Authority and its employees.

Israeli action "is a clear violation of the economic agreements signed in Paris in 1995 between Israelis and Palestinians," Ishtaye noted.

In May, Ishtaye said the Palestinian Authority had borrowed money from Palestinian banks to cover its deficit and pay salaries to its civil servants and security and police officers.

The Israeli media reported on Wednesday that the Palestinian authority had refused for the third consecutive month to accept the partial tax revenues that Israel transferred.