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Isis has lost 40% of the territory it once held in Iraq, and 20% of its territory in SyriaReuters

The Islamic State (Isis) has halved the salaries of its fighters due to mounting US-led coalition air strikes on the terror group's finances in Iraq and Syria. The move comes under "exceptional circumstances", the Isis's so-called treasury ministry in Raqqa said in a document released in December.

"On account of the exceptional circumstances the Islamic State is facing, it has been decided to reduce the salaries that are paid to all mujahideen by half, and it is not allowed for anyone to be exempted from this decision, whatever his position," according to a translation by Aymenn Jawad al-Tamimi, an IS (Daesh) expert and fellow at the Middle East Forum. "Let it be known that work will continue to distribute provisions twice every month as usual," the document said.

According to Tamimi, before the pay cut was introduced, IS fighters were earning a few hundred dollars in two monthly instalments. Though Isis fighters' salaries have been halved, they will still be getting paid twice a month, the document said.

Besides the salaries to its fighters, Isis has to spend tens of millions of dollars a month towards its terror operations, Tamimi said. In the document, Isis also said that it will continue to collect zakat, an obligatory religious tax.

The decisions come as air strikes and the ground offensive against the terror group have intensified in Iraq and Syria. Daesh is losing vast amounts of its money as US-led coalition forces have been targeting the terror group's cash storage facilities and bombing Isis oil trucks headed out of Syria and Iraq. Last week, two 2,000 pound bombs obliterated an Isis cash storage facility in Mosul containing millions of dollars in cash.

The Islamist group has lost 40% of the territory it once held in Iraq, and 20% of its territory in Syria.