Don't expect a rebate cheque

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Graham Martin-Royle (8/4/16) over-simplifies Britain's payments to the EU.

We do not receive a £9bn bill (nett of rebate and EU funding) on December 31, but we tax-payers do pay gross to the UK to pay the EU over 12 months.

When we leave, that will (nearly all) directly benefit Britain.

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The ‘true’ figures are elusive (ONS, Treasury, CER and Eurostat all differ), but Britain pays annually ‘about £20bn gross to EU institutions and the EU Budget’ (ONS).

The ‘iffy’ £350m per week better represents the magnitude of EU membership fees.

Norway only pays about £6.8m per week for full EU access (EU projects, admin, voluntary EEA grants... it does not contribute to the EU budget).

Non-EEA Switzerland pays about £1.9m per week (CER): per capita, that’s £1.40 per week versus our £6 per week.

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The ever-rising EU budget (largely CAP) is apportioned between 28 EU members (calculated by GNI) with Britain contributing ‘about’ £18bn gross, collected monthly in arrears from import duties and VAT receipts with the balance two months in arrears from general ‘gross’ UK taxes.

Our reducing ‘about’ £4bn rebate comes from 27 other EU national budget contributions; Britain likewise part-funds four national rebates.

The rebate is not deducted up front, but is calculated at year’s end and credited against next year’s contributions: hence £18bn gross, less £4bn ‘rebate’ equals £14bn nett in year two.

The variable £5bn ‘Free EU Funding’ also comes from budget contributions (mainly ours) but is paid-out as the EU dictates (often requiring UK part-funding) quite separately, a year in arrears.

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This is not deducted from budget contributions yet pro-EU campaigners regard this as a ‘refund’, hence their misleading creative accounting: £14bn nett less £5bn funds = £9bn ‘nett of nett’.

Still confused? Well, if you buy a £10 box of chocolates which contains a £1 coupon against your next purchase, do you pay the shopkeeper £10 or £9?

And when you pay £5 EU import duty ‘dock-side’ on a Chinese-made widget, don’t expect a £1.10p ‘adjustment nett of UK rebate’ refund!

We tax-payers never get refunded – so don’t expect a £4bn rebate cheque when we leave!

Barry M Jones

Bixley Lane

Beckley

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