§ 29. Mr. Leighton
asked the Chancellor of the Exchequer if he will make a statement about the implications of the Fontainbleau decision to raise the ceiling of the European Community's own resources to 1.4 per cent. for taxation policy.
§ Mr. Ian Stewart
There are no such implications. Under the budgetary arrangements agreed at Fontainbleau, the United Kingdom will receive abatements of its value added tax contributions to the Community. The effect of these abatements is expected to be that the United Kingdom's VAT rate will remain below 1 per cent. even though the ceiling for value added tax will increase to 1.4 per cent.