Outraged by punitive U.S. sanctions against Israel's annexation of the Golan Heights, Prime Minister Menachem Begin announced today that the strategic cooperation agreement with the United States is canceled, and that Israel will never be intimidated into rescinding the annexation of Syrian territory.

The announcement appeared to mark the lowest ebb of Israeli-U.S. relations since Begin and his Likud coalition were elected in 1977.

In a scathing admonishment read to the U.S. ambassador to Israel, Samuel Lewis, and later tacitly endorsed by the Cabinet and read to reporters, Begin said the United States was "priding" itself on punishing Israel with Friday's suspension of the strategic accord, which was signed three weeks ago in Washington.

"What kind of talk is this of punishing Israel? Are we a vassal state of yours? Are we a banana republic? Are we 14-year-olds who if we do not behave we get our wrists slapped? . . . You will not frighten us with punishments. Those who threaten us will find our ears deaf," Begin told Lewis, according to the statement read to reporters after the Cabinet meeting.

The prime minister's unprecedentedly harsh dressing down of its principal ally -- a long and occasionally rambling declaration that mentioned both U.S. actions in Vietnam and the inquisition of European Jews in the 15th century -- also accused the Reagan administration of participating in an anti-Semitic campaign to win Senate approval of the sale of sophisticated military equipment to Saudi Arabia.

"No one will frighten a large and free Jewish community in the United States. No one will succeed in deterring them with anti-Semitic propaganda. It will stand by our side," Begin declared.

Jews have survived for 3,700 years without a strategic cooperation agreement with the United States, Begin declared, and they will continue to survive without it.

"You are trying to make Israel a hostage of the memorandum of understanding on strategic cooperation . I consider your announcement of the suspension of the discussions on the memorandum of understanding as its cancellation. No, no sword of Damocles will hang over our head," Begin declared in the statement read by Cabinet Secretary Aryeh Naor after the Cabinet meeting.

He was referring to the Greek story of a king who illustrated to his courtier, Damocles, the perils of ruling by suspending a sword over his head by a single hair.

Begin accused the United States of conditioning its future participation in negotiations on Palestinian autonomy on Israel's flexibility in the peace talks and on its restraint in taking military action in Lebanon.

As if to signal an even harder line by Israel in the future, the prime minister said he would not agree to allow the approximately 100,000 Arabs in East Jerusalem to vote in the proposed election for an autonomous council. He also asked Lewis to inform U.S. Secretary of State Alexander M. Haig Jr. that Israel will not start a war in Lebanon, but that if it is attacked again by the Palestine Liberation Organization "we will respond with a counterattack."

The depth of Begin's bitterness over the U.S. sanctions, which also included a suspension of a commitment to purchase $200 million worth of Israeli-manufactured arms, was revealed in the prime minister's recalling of previous attempts by the United States to "punish" Israel.

Three times in the last six months, Begin said, the Reagan administration imposed punishments for actions Israel considered essential to its security, the previous two times involving suspension of delivery of F16 aircraft following Israel's bombing of the Iraqi nuclear reactor and the Israeli bombing of downtown Beirut.

"We read the history of World War II, and we know what happened to civilians when you operated against the enemy. We also read the history of the Vietnam war and your concept of 'body counts,' " Begin said. He added, "we have always made efforts to prevent casualties of civilians, but at times this is unavoidable, as happened in the bombing of the PLO headquarters in Beirut . Nevertheless, you punished us and suspended the delivery of the F16s."

"Now you are still priding yourselves that you are punishing Israel . . . You have no right to punish Israel, and I protest the use of this term," the prime minister said.

Referring to the "financial punishment" inherent in the suspension of the arms purchases, Begin recalled that during the British Mandate over Palestine, Lt. Gen. Sir Evelyn Barker, commander of British troops in the region, had lived in what now is the official prime minister's residence.

"Now I live here. When we fought him, you called us terrorists and we continued to fight. After we attacked his headquarters in the condemned King David building, Barker said that this race will be affected only when we hit its pocketbook, and he ordered his British soldiers not to patronize Jewish-owned cafes any longer. Hitting us in the pocketbook was Barker's philosophy," Begin said.

Begin's reference was to a statement Barker made after Begin's underground Irgun movement bombed the King David Hotel, killing and wounding more than 200 persons. Barker, in a published letter, mentioned "punishing the Jews in a way the race dislikes as much as any, namely by striking at their pocketbooks." The remark has been singled out as causing grave harm to Britain's position in Palestine at the time and for giving credence to allegations of British anti-Semitism.

Begin added, "Now I understand all this effort in the Senate to win a majority for the Saudi arms sale , accompanied by an ugly anti-Semitic campaign. First we heard the slogan, 'Begin or Reagan,' and then it followed that anyone who opposed the deal with Saudi Arabia supports a foreign head of state and is not loyal to the president of the United States. And so senators like Henry M. Jackson, Edward M. Kennedy, Bob Packwood and, of course, Sen. Rudy Boschwitz are not loyal citizens.

"Afterward, we heard the slogan 'We will not let the Jews determine United States policy.' What does this slogan mean? The Greek minority in the United States determined the Senate decision that deprived Turkey of arms deliveries after it invaded Cyprus."

Begin likened the U.S. demand that Israel rescind the Golan Heights annexation to "a concept of the days of the inquisition, when our forefathers were burned at the stake and did not rescind their faith."

He added, "We do not have to burn at the stake. We, praise God, have enough strength to defend our independence and our rights."

Begin asked Lewis, according to the account released by his office, to "kindly inform the secretary of state that the Golan Heights law will remain in force. There is no power in the world that will bring about its repeal."

Lewis met with Begin in the prime minister's home, where Begin is recuperating from a broken thigh. Also attending the meeting were Foreign Minister Yitzhak Shamir, Defense Minister Ariel Sharon, the Army chief of staff, Lt. Gen. Rafael Eitan, the heads of the various military intelligence branches and other defense officials.

Lewis refused to talk with reporters after the meeting, and Israeli government sources said the ambassador made no reply to Begin's statement. While the Cabinet did not formally vote its approval of the Begin statement, it was read to the ministers and then released as an official government statement. Naor said Begin was speaking on behalf of the Cabinet.

Deputy Foreign Minister Yehuda Ben-Meir said tonight Israel would be prepared to renew talks with the United States about reinstating the strategic cooperation agreement, but that the initiative would have to come from Washington.

"Relations between Israel and the United States are based on a strong and broad base, and I'm convinced we will find a way now to overcome difficulties of opinion. It is in Israel's interest to contain the differences of opinion," Ben-Meir said in an interview on Israeli radio.

Opposition Labor Party leader Shimon Peres, reacting to Begin's statement, said, "The real point is the state of rapport that exists between the United States and Israel. This should be our greatest worry. Neither anger nor protest should overtake this very serious connection. I don't like either punishment from Washington or from here."