HC Deb 30 March 1994 vol 240 cc877-8W
Mr. Andrew Smith

To ask the Chancellor of the Exchequer what is his estimate of the additional payments the United Kingdom will be obliged to make to the European Union in (a) 1994–95, (b) 1995–96 and (c) 1996–97 as a result of the imposition of VAT on domestic fuel.

Sir John Cope

[holding answer 25 March 1994]: The contributions made to the EC Budget under the Community's VAT—or "Third"—resource are made on the basis of a harmonised VAT base, designed to ensure that variations in VAT coverage and rates do not affect contributions. The Community's GNP—or "Fourth"—resource is based on GNP at market prices, and the imposition of VAT on domestic fuel is likely to increase very slightly United Kingdom payments under this heading. The EC budget is only established one year in advance so estimates of future payments are necessarily uncertain and the amounts will depend on the detailed circumstances of the EC budget in each year and the overall growth in EC GNP in general and United Kingdom GNP in particular.