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Ec (Own Resources)

Volume 82: debated on Monday 1 July 1985

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asked the Chancellor of the Exchequer, pursuant to the answer of 16 May, Official Report, columns 191–92, concerning EC own resources, to what factors he attributes the fact that the United Kingdom's value added tax contribution, as a percentage of gross domestic product, has risen by more than that of any other member state except Luxembourg since 1980.

[pursuant to his reply, 27 June 1985, c. 492]: Value added tax contributions to the EC are affected by a variety of factors, including the pattern of consumer expenditure and the prevailing economic climate in each country. Moreover, member states' annual VAT contributions shown in the table include adjustments relating to previous years. These factors distort comparisons between changes in United Kingdom VAT contributions as a percentage of GDP and those of other member states.Such comparisons need, in any case, to take account of the United Kingdom's refunds and abatements. The Fontainebleau agreement now ensures that the United Kingdom's VAT contributions will be substantially reduced.