Shalom's decision is "a step meant to deter those who seek to carry out terror attacks," PIBA was quoted by The Jerusalem Post newspaper on Thursday as saying.
In November 2012, a bus detonated while passing near the Israeli Defense Ministry building in Tel Aviv. The incident happened during Operation Pillar of Defense launched by the Israeli Defense Forces in the Hamas-governed Gaza Strip, following a number of mutual Israeli-Palestinian retaliatory attacks.
At least 24 people were wounded in the Tel Aviv bus bomb attack. Mafarja, who pleaded guilty to planting the bomb, was sentenced to 25 years in prison in 2014.
On Wednesday, Shalom announced the Israeli Security Cabinet's plans to punish those involved in terrorist activities by revoking their citizenship or residency status.
The move came amid a wave of clashes between Palestinians and Israeli nationals that has claimed dozens of lives since the beginning of the month.
The core of the long-standing Palestinian-Israeli conflict is essentially a struggle over land. Palestinians are seeking the diplomatic recognition of their independent state proclaimed in 1988 on the territories of West Bank, including East Jerusalem, and the Gaza Strip.
Most of the areas claimed by the State of Palestine have been occupied by Israel since 1967 in the aftermath of the Six-Day War, with the Israeli government refusing to recognize Palestine as an independent political and diplomatic entity.