The EU Parliament’s Grab For More Money For The EU.
Without Brexit, the UK economy would have been hammered under the latest plans
Yesterday the EU Parliament summarised its position on new and additional funding for the EU. It involves the introduction of six new EU-level taxes, as well as removing the rebates enjoyed by some countries. If the UK were still a full member of the EU this would have resulted in an increase of some 50% in the UK’s annual contributions to the EU.
These proposals were all originally made prior to the COVID crisis, but the plans are now being justified as being a solution to the massive need for funding as a result of the EU’s new financial mechanisms to deal with these commitments.
- January 2021: a new tax on member countries based on non-recycled plastic
- January 2021: a new tax on member countries based on the Emissions Trading System (a ‘carbon tax’)
- January 2023: a new digital services tax on internet-based businesses
- January 2023: a new carbon tax on imports of goods from outside the EU
- January 2024: a new financial transactions tax
- January 2026: a new EU corporate tax on companies
Taxes go up and rebates get abolished
Finally, there is complete removal of the rebates on contributions enjoyed by some countries. Last year the UK’s rebate was £4.5bn, so the UK’s net contributions to the EU would rise by this sort of amount if the UK were still a member.
In 2019 according to HM Treasury and the House of Commons Library, the UK’s net contribution to the EU was £9.44bn. In fact, it was higher, as a result of the “off-budget” payments to the EU which never appear in their summaries. Nevertheless, I have shown that the official figure would rise by 48% to £13.96bn without the UK’s rebate.
The costs of being a member of the EU would rise significantly under the EU Parliament’s plans
The EU Parliament has couched the new taxes in ways which disguise the fact that member countries and their citizens will end up paying more. Under the above measures, the cost of doing business in the EU will rise. Ultimately this has a direct effect on all citizens.
Here is an example of how these things are expressed in the EU Parliament’s legislative resolution of 16 September 2020 on the draft Council decision on the system of own resources of the European Union (10025/2020 — C9–0215/2020–2018/0135(CNS)
“such costs should be covered entirely by income from genuine new own resources”
To describe these new taxation revenue streams as “genuine new own resources” appears to come from the ‘money grows on (carbon-neutral) trees’ school of thinking.
The EU is not only spending, but it is also now having to borrow for the first time
The EU Parliament’s legislative resolution also gives permission for the EU Commission to borrow on the world markets for the first time, thereby setting a dangerous precedent. Here is the opening statement.
This Decision provides the legal basis for the Commission to borrow funds on the capital markets in order to finance expenditure in the framework of the Next Generation EU Recovery Package.”
When most prudent households find themselves in difficult economic times they tighten their belts. Not so the EU.
Four years ago when faced with a large shortfall in income as a result of losing the UK’s annual contribution, did the EU scale back on its expenditures? No, it just kept on spending. The EU then simply came up with the idea of a “Divorce Bill” which was shockingly agreed to by Theresa May and her government.
Today, faced with the double whammy of the loss of the “Bank of the UK” and the astronomical costs of the EU’s COVID measures, the EU Parliament’s solution is to tax more widely and deeply.
The EU Parliament is not, of course, the ultimate decision-maker. These things involve the EU Council and the EU Commission too. All I can say is that the Commission always wants to extend its reach and the globalist leaders of most of the EU member states believe in the gradual creation of a superstate of ‘Europe’.
All non-EU countries — including the UK — will be hit by the EU Parliament’s plans
Thanks to Brexit, the UK will not be facing a huge increase in its annual contribution for future years of membership of this sclerotic organisation. This would have happened — without Brexit — if the EU abolishes all rebates,
Instead, the UK taxpayer will merely be paying out huge sums which have no basis in international law for the EU’s contrived “Divorce Bill”.
That said, some of the new taxes described above will affect British companies who wish to trade with the EU, as well as those from other countries around the world. Taxes 3, 4, and 5 in the list above will almost certainly affect non-EU businesses.
Remainers never said what type of EU we would be remaining in
It’s important when reading a report such as the one above to state that the British public did actually vote for Brexit and we will be leaving. The Remain side has been fond of saying “Yes, but no-one ever voted for a particular type of Brexit.” However — and as I pointed out many times during the debate — no-one on the Remain side ever admitted that no-one knew what voting Remain would mean. What type of EU would we remain in? My report clearly shows one very expensive example of this.
The Brexit bonus
One way or the other Great Britain will finally be leaving the Customs Union and Single Market on 31 December 2020. Very sadly we will be leaving Northern Ireland behind, as things currently stand. We don’t yet know the precise terms of our departure, and we can only and sincerely hope that the Government will remain resolute and true to their words. If they don’t they will not be forgiven by a great many millions of voters.
To quote the Rt Hon Baroness Thatcher from a different era, 32 years ago.
“We have not successfully rolled back the frontiers of the state in Britain, only to see them reimposed at a European level, with a European super-state exercising a new dominance from Brussels.”
This threat remains if the Government does not repudiate the Withdrawal Treaty before the end of this year.
The upside is that the EU seems to be very busy, continuing to make itself less and less attractive as a place to do business. This presents great opportunities for an independent, democratic, sovereign, and free trade-loving United Kingdom to reap the rewards.
It is essential that the Government does not compromise in the coming weeks.
[ Sources: EU Parliament | HM Treasury | House of Commons Library ]