§ Mr. Teddy Taylorasked the Chancellor of the Exchequer what is the amount of rebate due to the United Kingdom which fell to be deducted at source from value added tax contributions in the current calendar year in consequence of the Fontainebleu agreement; what estimate he has made of the corrected final rebate which will fall to be payable by direct payments from the EEC; and if he will make a statement.
§ Mr. BrookeOur abatement in the 1986 Community budget is 1,900 mecu (£1,250 million). We have deducted accordingly over £100 million per month from our VAT contributions to the Community. The 1,900 mecu figure has been increased from 1,400 mecu (£920 million), the figure in the original 1986 draft budget. We do not expect a further significant correction.
§ Mr. Robert Sheldonasked the Chancellor of the Exchequer what estimate he has made of the increase in 667W revenue for 1986–87 and 1987–88 arising from the introduction of new penalties for late value added tax returns.
§ Mr. Lawson[pursuant to his reply, 16 December 1986, c. 488]: When these changes were announced in 1985 it was expected that the introduction of default surcharge would result in an improved revenue flow of £60 million in 1986–87 and £350 million in 1987–88. However, receipts of value added tax have so far this year been running above expecttions. Although it is too early to assess the reasons with confidence, it is possible that this is due in part to greater than forecast effects on revenue flow of the introduction of surcharge.