Ethiopian lawmakers approved slashing funding to the northern Tigray region, the upper house of parliament announced Wednesday, a decision a top Tigrayan official denounced as "totally unacceptable and dangerous".
The move deepens a bitter rift between the federal government in Addis Ababa and the regional government in Tigray, each of which sees the other as illegitimate.
The funding cuts are a response to Tigray's decision to hold regional elections last month despite a nationwide pause on all polls because of the coronavirus pandemic.
The House of Federation, the upper house of parliament, previously dismissed the regional elections as "null and void".
"The House of Federation has announced the illegally formed Tigray regional assembly and cabinet has no legal basis so will receive no budgetary support," House of Federation Speaker Adem Farah told state television Wednesday.
Tigray was due to receive federal budget subsidies totalling 10.4 billion Ethiopian birr (around $281 million) for the current fiscal year.
It is unclear how much of that amount would be affected.
Adem's interview aired one day after the House of Federation announced it would cut off contact with Tigray's leadership.
Adem said Wednesday that federal authorities would maintain relationships with lower-level government bodies in Tigray, though it was unclear how that arrangement might work.
Tigray is governed by the Tigray People's Liberation Front (TPLF), which dominated Ethiopian politics before Abiy came to power in 2018.
Under Abiy Tigrayan leaders have complained of being unfairly targeted in corruption prosecutions, removed from top positions and broadly scapegoated for the country's woes.
Ethiopia was due to hold national elections in August, but the country's poll body ruled in March that all voting would need to be postponed because of the coronavirus pandemic.
Tigrayan leaders rejected the extension of political mandates -- which before the pandemic were due to expire this week -- and say Abiy no longer has a mandate.
Wondimu Asamnew, head of the Tigray Friendship Liaison Office, told AFP Wednesday that cuts in federal funding for Tigray were "totally unacceptable and dangerous" and suggested they could jeopardise the region's future role in Ethiopia.
"You don't do this to a member of the federal republic unless you want, in practical terms, to declare that Tigray is an independent foreign state," Wondimu told AFP.
"The consequences are very, very serious," he said, adding that a formal response from Tigray would come "in a very short period of time".