£100bn extra not an EU budget hike

An extra £100bn is not a budget increase, according to EU bosses in Brussels. £100bn is the total amount of cash extra Brussels wants from member states - and Britain will be landed with £10bn extra to find for the period 2014-2020, claims vice president of the EU, Viviane Reding (pictured).


'No rise'

In an interview with BBC's Justin Webb, Reding claimed she was not asking for more cash. "The 5% figure is just the normal way the expenses are going over seven years and it is really stable." Reding claims her figures include inflation - so therefore it isn't a rise.

Inflation though is actually forecast to slide long term. Also, this increase comes after a recent massive increase. Our cost of membership increased by more than 50% in 2010/2011. Treasury figures claims that EU membership cost us £4.1bn in 2009/2010, and £6.4bn for the current year.

Taxing times

Yes, we still have a £3bn rebate but we have very little control over how our overall contribution is spent. The UK's net contributions to the EU Budget, economist Ruth Lea thinks, are expected to average almost £6½bn for the years 2011-2013 - double the average of the decade from 1997 to 2006, which averaged £3¼bn.

The government is saying the proposals are unrealistic. "Britain and the EU's other largest payers made clear in December that the EU budget should be frozen, and we will stick to that," a Downing Street spokesman has claimed.

The EU is also looking at how it could introduce an EU-wide VAT and/or a tax on financial transactions. More pain to come.
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