Informe de la Comisión - Financiación de la Unión Europea - Informe de la Comisión sobre el funcionamiento del sistema de recursos propios /* COM/2004/0505 final */





Informe de la Comisión - Financiación de la Unión Europea - Informe de la Comisión sobre el funcionamiento del sistema de recursos propios INTRODUCCIÓN El artículo 9 de la Decisión sobre recursos propios actualmente vigente [1] invita a la Comisión a emprender [1] Decisión del Consejo (2000/597/CE, EURATOM) sobre el sistema de recursos propios de las Comunidades Europeas, DO L 253 de 7.10.2000, p. 42. «antes del 1 de enero de 2006, una revisión general del sistema de recursos propios que, si procede, irá acompañada de las propuestas que sean oportunas a la luz de los factores pertinentes, incluidos, entre otros, los efectos de la ampliación sobre la financiación del presupuesto, la posibilidad de modificar la estructura de los recursos propios creando nuevos recursos propios autónomos y la corrección de desequilibrios presupuestarios concedida al Reino Unido, así como la concesión a Alemania, Austria, los Países Bajos y Suecia de la reducción del apartado 1 del artículo 5 ». En respuesta a una petición del Parlamento Europeo, y de común acuerdo con el Consejo, la Comisión se comprometió a presentar la revisión sobre el funcionamiento del sistema de financiación anteriormente mencionada antes de finales de 2004. El 10 de febrero de 2004, la Comisión aprobó su Comunicación sobre las Perspectivas Financieras 2007-2013 [2], en la que se señalaban fundamentalmente dos elementos en el actual sistema de recursos propios a los que era preciso prestar especial atención: en primer lugar, la insuficiente transparencia del sistema para los ciudadanos de la UE, combinada con la limitada autonomía financiera frente a los tesoros nacionales y, en segundo lugar, la necesidad de reformar el mecanismo existente de corrección de desequilibrios presupuestarios negativos. [2] COM(2004) 101 final de 10 de febrero de 2004. De conformidad con esas orientaciones, el presente informe ofrece una descripción general del sistema actual y de sus principales inconvenientes, propone un mecanismo generalizado de corrección como ajuste a corto plazo para abordar el principal problema pendiente y esboza, a más largo plazo, una estructura de recursos propios que sea efectiva, transparente y democrática. Una evaluación más detallada de estos problemas figura en el documento de trabajo de la Comisión anexo al presente informe. 1. El sistema actual de recursos propios El sistema actual de recursos propios es el resultado de modificaciones sucesivas del sistema originalmente implantado en 1970. Los recursos propios de la UE pueden dividirse en las tres siguientes categorías: (1) Los recursos propios tradicionales (RPT). Se trata principalmente de derechos de aduana y son recaudados por los Estados miembros en nombre de la UE. (2) El recurso basado en el impuesto sobre el valor añadido (IVA). El recurso IVA se recauda sobre unas teóricas bases IVA armonizadas de los Estados miembros, que se calculan a partir de los ingresos IVA nacionales. Además, la base IVA teórica se nivela, en caso pertinente, al 50 % de la renta nacional bruta (RNB) del Estado miembro para reducir el efecto del carácter ligeramente regresivo del IVA. En la práctica, en los países afectados por la nivelación, ésta convierte el recurso propio basado en el IVA en un recurso propio basado en la RNB. El tipo de referencia no puede exceder del 0,5 % de la base. (3) El recurso basado en la renta nacional bruta (RNB). Es el recurso residual utilizado para equilibrar el presupuesto. Se recauda proporcionalmente a la RNB de cada Estado miembro, aplicándosele a la misma un tipo uniforme. No hay ningún límite particular en este tipo si no es el techo de los recursos propios, que limita la cantidad total de todos los recursos propios a un máximo del 1, 24 % de la RNB de la UE. Finalmente, un mecanismo específico para corregir el desequilibrio presupuestario del Reino Unido forma también parte del sistema de los recursos propios (véase la sección 3). Se ha modificado en varias ocasiones, con lo que el mecanismo se ha vuelto cada vez más complejo y menos transparente. Los últimos cambios en el sistema de recursos propios fueron decididos por el Consejo Europeo de Berlín en 1999. Estos cambios han reforzado, aún más, la tendencia decreciente de los recursos propios tradicionales y los basados en el IVA con el correspondiente incremento de la parte relativa de las contribuciones basadas en el PNB/RNB [3]. [3] Antes de 2002, recurso basado en el PNB (Producto Nacional Bruto). Cuadro 1 - Composición de los recursos propios de UE (en porcentaje del total de recursos propios; en efectivo) >SITIO PARA UN CUADRO> 1 Desde el 2002, el % de los RPT retenido por los Estados miembros como compensación de los costes de recaudación ha aumentado del 10 % al 25 %. Esta diferencia representó alrededor de 2.200 millones de euros en 2002 así como en 2003. 2 Anteproyecto de Presupuesto Rectificativo 8/2004 (EU-25) 3 Anteproyecto de Presupuesto 2005. 2. Evaluación del funcionamiento del sistema actual de recursos propios 2.1. Criterios de evaluación El sistema de recursos propios y los recursos propios individualmente considerados puedan evaluarse según criterios específicos. Es prácticamente imposible que cada uno de los recursos propios satisfaga todos los posibles criterios de evaluación. Sin embargo, un sistema basado en una combinación de recursos de diversa naturaleza puede razonablemente satisfacer los principales criterios. Los siguientes siete criterios de evaluación se consideran pertinentes para el presente informe: * Visibilidad y simplicidad * Autonomía financiera * Contribución a una asignación eficiente de los recursos económicos * Suficiencia * Coste-eficacia de la gestión administrativa * Estabilidad de los recursos * Equidad en las contribuciones brutas 2.2. Evaluación El sistema actual ha funcionado bien por lo que respecta a los criterios de suficiencia y estabilidad, pero es evidente que no ha satisfecho el criterio de visibilidad y simplicidad y no contribuye significativamente a una asignación más eficiente de los recursos económicos en la UE. El sistema financiero se ha vuelto, con el tiempo, cada vez más complejo, de modo que, incluso a un ciudadano interesado, le resulta difícil comprender cómo funciona. Además, la autonomía financiera es cada vez más limitada. Aun cuando la financiación del presupuesto se garantiza por normas que son vinculantes para todos los Estados miembros, prácticamente no hay ninguna relación directa con los ciudadanos o los contribuyentes. Por el contrario, la financiación del presupuesto se basa en transferencias de los tesoros nacionales. En cuanto a los criterios restantes, el sistema financiero actual presenta diversos inconvenientes, según se explica más detalladamente en el documento de trabajo de la Comisión anexo al presente informe. 3. Prevención de saldos presupuestarios negativos excesivos 3.1. El problema de los desequilibrios presupuestarios La Unión Europea es una comunidad de solidaridad, en la que determinadas partes del presupuesto de la UE responden a un objetivo claro de solidaridad, mientras que otras financian la realización de objetivos específicos a través de programas acordados al nivel de la UE. Ello da lugar a beneficiarios netos del presupuesto de la UE y a contribuyentes netos al mismo, aunque los beneficios de las distintas medidas revierten a la Unión en su conjunto. Los saldos netos presupuestarios, medidos por la diferencia entre contribuciones al presupuesto de la UE e ingresos procedentes del mismo, es evidente que no reflejan suficientemente los beneficios que se derivan de la pertenencia a la UE. Sin embargo, las dimensiones de algunos de estos desequilibrios han centrado las discusiones políticas. En 1984 el Consejo Europeo de Fontainebleau introdujo el mecanismo existente de corrección por lo que se refiere a la contribución neta de un Estado miembro, el Reino Unido. Este mecanismo reembolsa al Reino Unido los 2/3 de sus contribuciones netas según el concepto de gastos asignados. La introducción de dicha corrección se basó en el siguiente principio general '... cualquier Estado miembro que soporte una carga presupuestaria que sea excesiva en relación con su prosperidad relativa puede beneficiarse de una corrección en el momento oportuno.' Aunque la corrección se decidiera solo para el Reino Unido, el principio de una corrección generalizada ya se reconoció, por lo tanto, en Fontainebleau («cualquier Estado miembro»), debiéndose basar la corrección en la dimensión del desequilibrio presupuestario («excesivo») y la riqueza de un Estado miembro en comparación con la UE en su conjunto («prosperidad relativa»'). Durante los últimos 20 años, la evolución económica, la ampliación y los cambios en la estructura del presupuesto de la UE han modificado considerablemente el contexto en el que funciona el mecanismo de la corrección británica existente. La tabla más abajo muestra el desarrollo de la renta nacional bruta (RNB) per cápita, expresada en estándares de poder adquisitivo (EPA [4]), entre los años 1984 y 2003 para todos los Estados miembros que eran contribuyentes netos al presupuesto de la UE en el año 2002 [5]. [4] El EPA es una moneda artificial que refleja diferencias en los niveles de precios nacionales que no se tienen en cuenta por los tipos de cambio. Esta unidad permite significativas comparaciones de magnitudes de indicadores económicos entre países. [5] Los saldos netos ofrecidos en el presente documento, como los utilizados para la corrección británica, se calculan incluyendo los gastos de administración. Por esta razón, Bélgica y Luxemburgo no aparecen entre los contribuidores netos. Como la corrección se paga un año más tarde, la corrección de 2007 se debe pagar en 2008. >SITIO PARA UN CUADRO> Ante el drástico cambio de la posición británica en comparación con los restantes contribuyentes netos, y en aplicación del principio de Fontainebleau, la concesión de una corrección de forma exclusiva al Reino Unido debe ser reconsiderada. Por lo tanto, el mecanismo existente debería transformarse en un mecanismo generalizado de corrección, que respetara los objetivos paralelos de * impedir excesivos saldos presupuestarios negativos, junto con una reducción de las diferencias entre contribuyentes netos de niveles comparables de prosperidad; * garantizar que los costes de financiación del mecanismo se mantienen en unos niveles razonables. 3.2. Incidencia del mecanismo de corrección existente en los saldos netos de los Estados miembros En el mecanismo existente, el reembolso al Reino Unido de su contribución neta es el 66%. El mecanismo es financiado por todos los Estados miembros según sus respectivas participaciones en la RNB con las siguientes excepciones: - El Reino Unido no participa en la financiación de su propia restitución - La participación de DE, NL, AT y SE se restringe al 25 % de sus participaciones normales. Si bien es cierto que la posición neta británica antes de la corrección ha cambiado poco desde la introducción de la misma (-0,48% de RNB en 1985 y -0,47% durante el período de 1996 a 2002), su posición neta final ha mejorado notablemente en comparación con otros Estados miembros de niveles de prosperidad similares, o incluso más bajos, como NL y DE (-0,47% y -0,44%, respectivamente). Un factor muy significativo para evaluar el mecanismo de corrección existente es su incidencia en la ampliación. Con la adhesión de nuevos beneficiarios netos, los saldos netos de todos los antiguos Estados miembros han de deteriorarse puesto que un porcentaje cada vez mayor de gasto se asigna a los nuevos Estados miembros. Sin embargo, como consecuencia del mecanismo actual, el volumen de la corrección aumentará muy significativamente para el Reino Unido y el coste para los otros Estados miembros, incluidos todos los nuevos Estados miembros, será mayor. En caso de que el actual mecanismo de corrección siga en vigor, la corrección del Reino Unido se incrementaría en más del 50% según los cálculos de la Comisión sobre la base de la propuesta de la Comisión para las perspectivas financieras de 2007-2013. 3.3. Mecanismo generalizado de corrección propuesto La Comisión propone la generalización del mecanismo de corrección, que iría evolucionando desde la corrección actualmente existente hasta aproximarse al objetivo original de evitar excesivas cargas presupuestarias. La introducción de una especie de 'red de seguridad' para los grandes contribuyentes netos, cuya contribución neta rebase cierto nivel, puede asimismo facilitar un planteamiento más constructivo mediante el que se garantice que los recursos presupuestarios están a la altura de los retos políticos de la Unión ampliada. La futura corrección ha de calcularse sobre la base del saldo presupuestario neto de cada Estado miembro en relación con el presupuesto de la UE. El mecanismo se desencadena si las contribuciones netas superan un umbral, expresado en porcentaje de RNB de cada Estado miembro, que refleja el mínimo nivel aceptado de solidaridad financiera entre Estados miembros. Las situaciones netas que superen dicho umbral optarán a una corrección (devolución parcial), lo que supone una garantía contra la presencia de contribuciones netas excesivas. Por el contrario, el volumen total de correcciones (volumen para devoluciones) se limitará a una cantidad máxima, protegiéndose con ello a los que no se benefician de la corrección de que los costes del mecanismo resulten excesivos, Si la suma de todas las correcciones supera el volumen total predeterminado, el tipo de devolución se reducirá en consecuencia. Cualquier mecanismo de corrección entraña complicaciones para la financiación del presupuesto. Por lo tanto, la propuesta básica debe ser relativamente simple y suficientemente transparente. A este respecto, los parámetros actualmente utilizados para el cálculo de la corrección del Reino Unido deberían modificarse solamente en caso necesario y simplificarse siempre que fuera posible. El nuevo mecanismo propuesto por la Comisión contiene los siguientes elementos: - Establecimiento de un umbral en porcentaje del RNB; - Nivelación del volumen total de correcciones; - Simplificación de la financiación de las correcciones, al basarlas en la participación en la RNB, de modo que todos los Estados miembros participen en la financiación del importe global de las correcciones en proporción a su prosperidad relativa; - Mantenimiento sin cambios del concepto de gastos asignados y del índice de reembolso hasta el volumen máximo. Según esta propuesta, el Reino Unido sería con mucho el principal beneficiario del mecanismo generalizado de corrección. Según la propuesta de la Comisión sobre las próximas perspectivas financieras y la propuesta sobre un mecanismo generalizado de corrección, el Reino Unido recibiría, por término medio, una compensación neta de aproximadamente el doble de la de Dinamarca. >SITIO PARA UN CUADRO> El cuadro más arriba ilustra los saldos presupuestarios netos medios estimados de los Estados miembros resultantes del mecanismo generalizado de corrección propuesto durante el período que se extiende hasta 2013 y los compara con la continuación del mecanismo actual y una situación sin corrección alguna. El mecanismo generalizado de corrección disminuirá los saldos netos negativos, reducirá las diferencias entre contribuyentes netos, y, por otra parte, aligerará la carga financiera de los que no se benefician del mecanismo. [6] [6] Para mayor información, véase el anexo técnico adjunto. La Comisión presenta por separado una propuesta específica de modificación de la actual Decisión sobre los recursos propios con vistas a la introducción del mecanismo generalizado de corrección propuesto. 4. Estructura de los recursos propios 4.1. Búsqueda de la óptima estructura de los recursos propios Más abajo se discuten tres alternativas básicas para la financiación del presupuesto de la UE. En los tres casos se mantendrían los recursos propios tradicionales (RPT), pues la recaudación de los derechos de importación constituye un instrumento de la política comercial de la Unión Europea cuyos beneficios revierten 'naturalmente' a la Unión. (1) Mantenimiento del actual sistema de financiación sin cambios El actual sistema de financiación ha garantizado una correcta financiación del presupuesto de la UE. Sin embargo, bajo su actual forma, el sistema de financiación carece de vínculos directos con los ciudadanos. Recientes ajustes para satisfacer intereses específicos han añadido opacidad al sistema. La opinión pública no percibe pues las consecuencias presupuestarias de las políticas de la Unión. Ante el peso abrumador de los recursos basados en la RNB, los Estados miembros, y en especial los contribuyentes netos, tienden a juzgar las políticas e iniciativas de la UE exclusivamente en términos de su asignación nacional, con escasa consideración a la esencia de las políticas y con el consiguiente riesgo de ocultación del valor añadido de las políticas de la UE. Ante la falta de vínculos con los ciudadanos de la UE y la ausencia de visibilidad para los mismos, así como debido a los incentivos cada vez mayores para centrarse en el limitado concepto presupuestario de la justa compensación ('juste retour'), debería reformarse el actual sistema. (2) Un sistema de financiación exclusivamente basado en la RNB Bajo un sistema de financiación basado exclusivamente en clave de RNB, la Unión dependería enteramente de las 'contribuciones' de los Estados miembros. La ventaja de un sistema de este tipo es que sería simple y fácil de comprender. Las "contribuciones" estarían estrechamente vinculadas a la riqueza relativa de los Estados miembros. Aunque la financiación del presupuesto por contribuciones de los Estados miembros es adecuado para una organización internacional como la ONU, sin embargo, no refleja la naturaleza jurídica de la Unión Europea. Implicaría una idea de la Unión en la que los ciudadanos estarían representados de manera exclusivamente indirecta por sus Estados miembros. La naturaleza de la UE como Unión de Estados miembros y de ciudadanos, que se refleja actualmente en el Tratado, se abandonaría en lo que respecta a la financiación del presupuesto. Esto implicaría, por su parte, el abandono del concepto de 'recursos propios', que ha sido una piedra angular de las finanzas de la UE desde la primera Decisión sobre los recursos propios de 1970. La Comisión rechaza tal alternativa. (3) Un sistema de financiación basado en recursos propios fiscales Un sistema en gran parte fundado en recursos propios basados en impuestos presenta el potencial de aumentar la autonomía financiera del presupuesto de la UE, al crear una relación financiera más directa entre el presupuesto de la UE y los ciudadanos de la Unión. El paso, en la financiación del presupuesto de la UE, a unos contribuyentes representados por individuos y operadores económicos, con la correspondiente reducción de las contribuciones de los Estados miembros, entrañaría una mayor visibilidad para los ciudadanos, al mismo tiempo que, con ello, se incrementaría la responsabilidad política de la autoridad presupuestaria por sus decisiones de gasto. Contribuiría asimismo a desviar la discusión política del estrecho enfoque centrado en las contribuciones nacionales para focalizarla en los méritos de las políticas de la UE y el interés europeo general. Por último, la cada vez mayor visibilidad aumentaría la confianza en las finanzas de la UE, cuyo volumen de menos del 2,5% del gasto público total en la UE se suele sobrestimar. Sin embargo, una financiación del presupuesto de la UE plenamente basada en impuestos tampoco parece apropiada. Puesto que el requisito de presupuesto equilibrado del artículo 268 del Tratado ni se cuestiona ni puede cuestionarse, un recurso fiscal que asumiera el papel actual de la RNB como recurso 'residual' equilibrador o bien supondría un tipo impositivo variable en función de los requerimientos presupuestarios o bien exigiría una mayor flexibilidad en el gasto de la que permite el actual marco de las perspectivas financieras. Unas frecuentes modificaciones del tipo impositivo serían incómodas para los contribuyentes (falta de seguridad jurídica, procedimientos onerosos desde un punto de vista técnico y administrativo) y podrían, en la práctica, entrar en conflicto con el sistema impositivo nacional. Parece preferible un planteamiento progresivo, consistente en mantener un limitado recurso RNB, aumentando al mismo tiempo la parte de los recursos basados en los impuestos. Por lo tanto, la reforma de la estructura de los recursos propios debería centrarse en la introducción presupuestariamente neutra de un nuevo recurso propio basado en impuestos, que representara hasta la mitad del presupuesto. 5. Hacia un sistema de financiación basado en contribuciones de los Estados miembros y los ciudadanos 5.1. Aumentar la parte de recursos propios basados en impuestos La reforma del sistema de financiación debería abordar los inconvenientes del actual sistema, por ejemplo, la falta de vínculo directo con los ciudadanos de la UE, la dependencia de las transferencias de los tesoros nacionales y una complejidad injustificada, contribuyendo al mismo tiempo, en la medida de lo posible, a la asignación eficiente de los recursos. Otros criterios resultan menos pertinentes para los nuevos recursos, ya que el sistema, en general, facilita una razonable satisfacción de los mismos. Por razones de equidad entre ciudadanos de los diferentes Estados miembros, la introducción de nuevos recursos fiscales requiere una armonización previa de la base imponible en grado suficiente. La elección de cuáles son los recursos basados en impuestos más apropiados depende decisivamente del grado real de armonización de la base impositiva. La existencia de arbitrariedades regionales [7] o la presencia de externalidades transfronterizas son poderosos argumentos en favor de la armonización de bases imponibles y tipos impositivos, que podrían asimismo justificar la asignación de todo o parte de los correspondientes ingresos fiscales al nivel de la UE. Con ello se podría contribuir a disminuir la ineficaz asignación de recursos económicos. [7] Las arbitrariedades regionales hacen referencia a situaciones en las que es difícil determinar la parte exacta de una base impositiva que debe asignarse a un Estado miembro o en las que hay una elevada (potencial) discordancia entre el país que recauda el impuesto y el país de residencia de los agentes económicos que soportan la carga tributaria. El incremento de la parte de recursos propios basados en los impuestos en el presupuesto de la UE no requiere ningún nuevo impuesto. Sí que supone, en cambio, una decisión sobre la distribución de los ingresos fiscales o tipos impositivos entre el nivel nacional y el de la UE. La cuota de la UE podría recaudarse como parte del tipo nacional pagado por los contribuyentes. El presupuesto total de la UE, limitado en cualquier caso por el techo de los recursos propios en un máximo del 1,24% de la RNB de la UE, no aumentaría puesto que los ingresos procedentes de los recursos basados en los impuestos se compensarían por la disminución correspondiente del actual recurso basado en la RNB. Las siguientes secciones ilustran las tres principales opciones para mejorar el funcionamiento del sistema de financiación de la UE. Los tres mantienen el actual recurso basado en la RNB como un recurso residual equilibrador, así como los recursos propios tradicionales, pero asumen que, hasta en un 50%, el presupuesto se financia por nuevos recursos fiscales, que también reemplazarían el actual IVA estadístico. 5.2. Opción 1 - Sistema de recursos propios con recursos fiscales relacionados con el consumo energético De conformidad con la nueva Directiva sobre imposición de la energía [8] la mayor parte de los productos energéticos están sujetos a imposición comunitaria. Aunque la Directiva sobre imposición de la energía aprobada no se elaborara con el fin de introducir nuevos recursos propios, sin embargo ha creado las condiciones adecuadas para ello, al armonizar las bases imponibles y establecer tipos impositivos mínimos. [8] Directiva del Consejo 2003/96/CE, de 27.10.2003, por la que se reestructura el régimen comunitario de imposición de los productos energéticos y de la electricidad (DO L 283 de 31.10.2003). Un recurso fiscal sobre productos energéticos no necesitaría basarse en todos los productos cubiertos por la Directiva. La recaudación de la UE podría limitarse a la base imponible relacionada con los carburantes de automoción utilizados para el transporte por carretera (gasolina con plomo y sin plomo, gasóleo, gas natural y GPL utilizados para el transporte). Sería relativamente sencillo desde un punto de vista administrativo, puesto que la base imponible ya está armonizada al nivel de la UE y la mayor parte de las posibilidades de diferenciación de tipos permitidas por la directiva se aplican a otros productos energéticos. Para financiar la mitad del presupuesto de la UE bastarían unos tipos de la UE inferiores a la mitad de los tipos mínimos de la Directiva sobre imposición de la energía. La principal decisión giraría en torno a los tipos que deberían aplicarse y las posibles variaciones según productos y usos. La recaudación de la UE sobre los carburantes de aviación o las emisiones con los mismos relacionadas podría ser un complemento útil a la recaudación sobre los carburantes de automoción para el transporte por carretera. El sistema de transporte aéreo europeo está altamente integrado y las emisiones de aviación trascienden las fronteras nacionales. Existen, por lo tanto, buenos argumentos para gravar tales emisiones al nivel de la UE, como una manera de interiorizar los costes socioeconómicos externos de cambio climático y otros efectos ambientales causados por la aviación en el precio del pasaje aéreo. Sin embargo, el carburante de aviación (keroseno) está en la actualidad exento de impuestos por lo que a los vuelos transfronterizos se .refiere Desde un punto de vista técnico, la introducción de un recurso fiscal basado en el carburante para el transporte por carretera sería posible en un período relativamente breve de tiempo (alrededor de 3 a 6 años). 5.3. Opción 2 - Sistema de recursos propios con un recurso fiscal IVA Debido a su vínculo directo con el consumo diario, y al contrario de lo que ocurre con el actual recurso IVA «estadístico», la aplicación de un tipo UE a la base nacional IVA establecería un vínculo directo claro entre la financiación del presupuesto de la UE y el ciudadano e incrementaría la conciencia de los costes de la Unión. Un recurso IVA genuinamente fiscal se aplicaría mediante un tipo UE que fuera una parte del tipo IVA nacional pagado por los contribuyentes. Este tipo UE se recaudaría junto con el tipo nacional sobre la misma base imponible. Los ciudadanos no tendrían que soportar ninguna carga tributaria adicional ya que el tipo UE se compensaría con una disminución equivalente del tipo IVA nacional. Por ejemplo, si el tipo IVA nacional fuera del 21% y el tipo UE del 1%, el tipo nacional bajaría al 20%. El tipo IVA total recaudado seguiría siendo del 21%. Por razones de visibilidad, el IVA de la UE y el IVA nacional deberían aparecer como impuestos separados en la factura o el recibo que el sujeto pasivo entregue a su cliente. Un tipo de la UE del 1 % bastaría para cubrir la mitad de las necesidades de financiación del presupuesto de la UE. Las dificultades potenciales de esta propuesta están relacionadas con la incompleta armonización de los sistemas IVA de los Estados miembros, vinculada fundamentalmente a los llamados bienes del tipo cero. Otra dificultad potencial puede provenir de la diferente participación de la base IVA en la renta nacional en los distintos Estados miembros (el así llamado carácter regresivo del IVA), que, desde 1988, ha impulsado los Estados miembros a reducir su parte en los recursos propios. Por otra parte, desde la perspectiva del consumidor, el tipo de la UE tendría la misma incidencia en consumidores comparables en todo el territorio de la Unión [9]. [9] Partiendo de que se neutraliza el efecto de los tipos cero (véase asimismo el anexo a este informe). Desde un punto de vista técnico, la introducción de un tipo IVA de la UE sería posible en un período relativamente breve de tiempo (máximo 6 años). 5.4. Opción 3 - Sistema de recursos propios con un recurso fiscal basado en el impuesto de sociedades Al igual que en las otras dos opciones, un recurso fiscal de la UE basado en el impuesto de sociedades también requeriría una definición previa de la base imponible (consolidada) común, que se aplicaría a las sociedades. Tal armonización contribuiría al adecuado funcionamiento del mercado interior y a una asignación más eficiente de los recursos económicos, que en la actualidad están siendo distorsionados por las externalidades transfronterizas. Hoy en día, la existencia de 25 sistemas impositivos nacionales separados y la multiplicidad de leyes, convenios y prácticas fiscales representa, en sí misma, un obstáculo a la actividad económica transfronteriza e impone considerables costes de cumplimiento a las empresas que desarrollan actividades transfronterizas dentro del territorio de la UE, conduciendo a numerosas lagunas en el sistema impositivo. El trabajo actualmente en curso sobre la fiscalidad de las sociedades se centra en el concepto de una base imponible (consolidada) común, con toda probabilidad para un subgrupo de Estados miembros interesados, con el fin de retirar los obstáculos fiscales al mercado interior. Este trabajo no prevé ninguna acción sobre los tipos impositivos, ni se concibe como un método para obtener ingresos para el presupuesto de la UE. La opción de un impuesto de sociedades entrañaría establecer un tipo impositivo mínimo sobre la base imponible armonizada. Los ingresos procedentes del impuesto de sociedades son significativos, de modo que los ingresos totales en la UE representan en la actualidad una media del 2,6 % de la RNB total de la UE. Por lo tanto, para las necesidades del presupuesto de la UE, sería preciso asignar a la UE menos de la cuarta parte de esos ingresos. Dada la situación actual, la aplicación de esta alternativa llevaría más tiempo, tanto desde la perspectiva política como desde la administrativa. 6. Resumen y conclusiones La introducción de un nuevo recurso propio basado en los impuestos, que reemplazara el actual recurso IVA estadístico y financiara una parte significativa del presupuesto de la UE, permitiría superar las principales inconvenientes del sistema actual, por ejemplo, la falta de vínculos directos con los ciudadanos de la UE, la abrumadora dependencia de las transferencias de los tesoros nacionales y una complejidad injustificada. Asimismo podría contribuir a una mejor asignación de los recursos económicos en la UE. Aun cuando representaría una parte menor del total de los recursos propios que en el actual sistema, el recurso basado en la RNB seguiría desempeñando un importante papel y garantizando que el sistema satisface de manera razonable los oportunos criterios. La Comisión propone tres posibles candidatos a futuro recurso propio fiscal: un recurso basado en 1) el consumo de energía. 2) la base IVA nacional y 3) el impuesto de sociedades. Un recurso basado en el consumo de energía y concebido como un tributo de la UE sobre los carburantes de automoción para el transporte por carretera sería una fuente de financiación para el presupuesto de la UE suficiente y estable y crearía un vínculo directo con los ciudadanos. La base imponible ya está armonizada al nivel de la UE. Podría complementarse con un tributo de la UE sobre el carburante de aviación o las emisiones con el mismo relacionadas, de modo que se pusiera fin a la actual exención fiscal de los carburantes de jet y se estableciera un precio a los costes medioambientales de la aviación. La armonización de la base imponible en el ámbito del IVA está bastante avanzada y constituye una fuente de ingresos estable y suficiente. Un recurso IVA fiscal haría la financiación de la UE extraordinariamente visible para los ciudadanos. Tendría asimismo un carácter evolutivo, ya que entrañaría la reforma de disposiciones existentes antes que la introducción de un recurso completamente nuevo. Desde un punto de vista administrativo, no presentaría dificultades insuperables. Debido a los vínculos con una política común de la UE y la presencia de externalidades transfronterizas, los ingresos procedentes de una base imponible armonizada del impuesto de sociedades también serían una fuente adecuada de financiación del presupuesto de la UE. La Unión Europea es una Unión de Estados miembros y ciudadanos. Cualquiera de los tres candidatos a los recursos propios fiscales examinados anteriormente transpondría este concepto al área de la financiación del presupuesto de la UE. Reforzar el vínculo directo de los ciudadanos con el presupuesto contribuiría asimismo a centrar los debates sobre el gasto en los aspectos sustanciales, en lugar de en las «posiciones netas» presupuestarias, de índole puramente nacional. Obviamente, cualquier nueva asignación de recursos al presupuesto de la UE no sólo ha de ser decidida por unanimidad por el Consejo, sino que también tiene que ser ratificada por los Parlamentos de todos los Estados miembros. La implantación de un recurso basado en la energía o basado en el IVA sería factible a medio plazo, mientras que una recurso fiscal basado en el impuesto de sociedades ha de considerarse una opción a mucho más largo plazo Lo que ahora se necesita es una orientación política para preparar las condiciones de la reforma de la estructura de los recursos propios existentes. A este respecto, la Comisión invita al Consejo a: - discutir las opciones propuestas en el presente informe; - tomar nota de la intención de la Comisión de preparar una hoja de ruta con vistas a la sustitución, sobre la base de una propuesta de la Comisión, de los recursos actuales de IVA por un recurso propio netamente fiscal antes de 2014. Con objeto de aportar una solución a corto plazo al problema de los desequilibrios presupuestarios excesivos que sea aplicable a partir del principio de las próximas perspectivas financieras, la Comisión propone - introducir un mecanismo generalizado de corrección para corregir los desequilibrios presupuestarios excesivos de conformidad con la Decisión del Consejo sobre el sistema de recursos propios propuesta y las medidas de aplicación propuestas que la acompañan. TECHNICAL ANNEX Financing the European Union Commission report on the operation of the own resources system INTRODUCTION Article 9 of the current own resources decision [1] calls on the Commission to [1] Council decision (2000/597, EC, Euratom) on the system of the European Communities' own resources, OJ L 253, 7.10.2000, p. 42. 'undertake, before 1 January 2006, a general review of the own resources system, accompanied, if necessary, by appropriate proposals, in the light of all relevant factors, including the effects of enlargement on the financing of the budget, the possibility of modifying the structure of the own resources by creating new autonomous own resources and the correction of budgetary imbalances granted to the United Kingdom as well as the granting to Austria, Germany, the Netherlands and Sweden of the reduction pursuant to Article 5(1)'. In response to a request from the European Parliament and in agreement with the Council, the Commission committed itself to present the abovementioned review on the functioning of the financing system before the end of 2004. On 10 February 2004, the Commission adopted its communication [2] on 'Building our common future - Policy challenges and budgetary means of the enlarged Union 2007-2013'. The communication identified two main elements of the current own resources system deserving closer attention: first, the insufficient transparency of the system for EU citizens combined with limited financial autonomy from national treasuries; secondly, the need to reform the existing mechanism for correction of negative budgetary imbalances. [2] COM(2004) 101 final of 10 February 2004. This report reviews those issues in more detail. For this purpose it is divided in four parts. Part I of the report presents the main features of the current system, the relevant assessment criteria and provides an assessment of the functioning of the current financing system. Part II examines the existing mechanism to correct budgetary imbalances and proposes to replace it with a generalised mechanism for correcting excessive negative budgetary balances in order to ensure an equitable treatment of net contributors at comparable levels of prosperity and financing costs that are kept at a reasonable level. Part III reviews alternative scenarios for the system of financing the EU budget and outlines possible own resources systems that in the longer term might allow certain drawbacks of the current own resources system to be overcome. It is important to stress that future modifications of the own resources system in line with what is proposed in Part III would probably require a review of the generalised correction mechanism proposed in Part II. Thus, whereas part II is to be seen as the short term adjustment of the current system in order to address the main outstanding issue, part III offers for the longer term the outline of a system that would be more effective, transparent and democratic. Finally, Part IV of the report presents the final comments. PART I - THE PERFORMANCE OF THE CURRENT OWN RESOURCES SYSTEM This part provides an overview of the current system of own resources, presents the criteria used for assessing the performance of own resources individually and together as a system, and then provides an overall assessment. 1. The current own resources system The current own resources system is the result of successive modifications of the original system introduced in 1970. The latest modifications were decided by the European Council in Berlin in 1999 and implemented through the own resources decision of 29 September 2000 [3] (see below). [3] See footnote 1. The current own resources may be divided into three categories that are used to finance the budget in a sequential way, i.e. recourse is made to the following category only when the previous one is exhausted. In practice this means that the third category, the one related to the gross national income (GNI) of Member States, is the residual one used to balance the budget. It is also the only resource to be affected by modifications of budgeted expenditure during the implementation of the budget, i.e. stemming from amendments to the budget. The three categories of own resources are the following: (1) So-called traditional own resources (TOR). These are mainly [4] customs duties and are collected by Member States on behalf of the EU. Member States retain a fixed percentage of the amounts collected as a compensation for their costs of collecting them. The percentage was increased from 10 % to 25 % as from 2001. [4] Traditional own resources also include agricultural duties, i.e. import duties collected on agricultural products, and sugar levies. Together, these two categories are estimated to account for around 10 % of total TOR and 1.2 % of total own resources in 2004). (2) The resource based on value added tax (VAT). This resource is levied on the notional harmonised VAT bases of Member States. The statistical 'notional' VAT bases are calculated in order to compensate for differences in national VAT regimes due to incomplete harmonisation of VAT at EU level. The notional VAT base is calculated, for each Member State, by dividing total national VAT receipts by the so-called weighted average rate of VAT. The weighted average rate is derived from macro-economic statistics (mainly national accounts). In order to take account of the specific national procedures and arrive at a harmonised base for all Member States, changes are made, either to the net revenue collected (known as 'corrections'), or to the VAT base (known as 'financial compensations'). This implies, once again, that statistical elements are used in the calculation of the VAT base rather than fiscal data. Furthermore, the notional VAT base is 'capped', where applicable [5], at 50 % of each Member States' GNI to reduce the effect of the 'regressive' character [6] of VAT. In practice, this turns the VAT-based own resource into a GNI-based resource for the countries concerned by the capping rule. Any increase in VAT receipts in a Member State whose VAT base is capped will have no effect on the EU VAT resource. [5] Forecasts for 2005 indicate that for 13 out of 25 Member States their VAT base will exceed 50 % of their GNI. [6] The share of consumption in national income tends to be higher in relatively less prosperous countries. As a result, VAT revenue tends to be proportionally higher than in more prosperous countries. A uniform percentage rate is levied on the capped and harmonised VAT bases of all Member States. This call rate cannot exceed 0.5 % of the base but is furthermore reduced to take into account the theoretical impact of the amount of the UK correction (see below). (3) The GNI-based resource. This resource is levied as a uniform rate in proportion to the GNI of each Member State. There is no particular limit on this rate, other than the own resources ceiling that limits the total amount of all own resources to a maximum of 1.24 % of the EU's GNI. Finally, a specific mechanism for correcting the budgetary imbalance of the United Kingdom is also part of the own resources system. The basic principle of the correction mechanism is to reimburse the UK by 66 % of its budgetary imbalance. The mechanism reduces the own resources payments of the UK and increases the payments of all other Member States, including the 10 new Member States joining in 2004. The correction mechanism has been modified on several occasions since its introduction in 1985 in order to neutralise the impact on the UK budgetary balance of each subsequent modification of the own resources system. Several additional layers have therefore been added to the original calculation, rendering the mechanism increasingly complex and non-transparent. According to the rules of the own resources system the amount of the UK correction also has an impact on the rate of call of VAT, which is reduced by a percentage theoretically needed to finance the correction ('the frozen rate'). This is a relic from the time the correction was financed on the basis of Member States' shares in the EU VAT base, whereas since 1988 the financing is in reality calculated on the basis of GNI. The cost of the correction is borne by the other Member States in proportion to their GNI. However, in order to alleviate the budgetary imbalances of four other Member States (Austria, Germany, the Netherlands and Sweden) these countries pay only 25 % of their normal share. The financing of this reduction is added to the payments of the remaining 20 Member States. The latest changes to the own resources system were implemented through the current own resources decision of 29 September 2000 and notably concerned the following elements: - An increase in the percentage of traditional own resources retained by Member States from 10 % to 25 %. - A reduction of the maximum rate of call of the VAT resource from 1 % to 0.75 % in 2002 and 0.5 % in 2004. - Some changes to the method of calculating the UK correction in order to compensate for effects related to enlargement and the increase in the percentage of traditional own resources retained by Member States. - A reduction of the share of Austria, Germany, the Netherlands and Sweden in the financing of the UK correction to one fourth of its normal value. Previously only Germany had a reduction, by one third, of its financing share. - The European system of accounts 1995 (ESA 95) replaced the previous version, ESA 79, also in the budgetary and own resources area. As a consequence gross national income (GNI) replaced the concept of gross national product (GNP) in the area of the EU budget. This package further reinforced the declining trend of traditional and VAT-based own resources and the corresponding increase in the relative share of the GNP/GNI- based contributions. Table 1 - The composition of EU own resources (in per cent of total own resources; cash basis) >SITIO PARA UN CUADRO> 1 As from 2002 the % of TOR retained by Member States as a compensation for their collection costs was raised from 10 % to 25 %. This difference represented about EUR 2.2 billion in 2002 as well as in 2003. 2 Preliminary draft amending budget 8/2004 (EU-25). 3 Preliminary draft budget 2005. 2. Assessment criteria The own resources system and individual own resources can be assessed against specific criteria. It is virtually impossible for individual own resources to satisfy all criteria. However, a system based on a combination of resources of different natures may reasonably meet the different criteria. The 'systemic' assessment is discussed in more detail in part III of the report. The following seven assessment criteria are relevant to this report: - Visibility and simplicity; i.e. the financing of the EU budget should be visible to and understood by EU citizens. - Financial autonomy; i.e. the financing of the EU budget should provide a sufficient degree of autonomy from national treasuries to reduce the tendency towards a narrow focus on national interest. Autonomy is enhanced if the financing relies to a significant degree on a direct link with citizens/taxpayers. - Efficient allocation; i.e. the financing of the EU should contribute to an efficient allocation of economic resources, for example by contributing to the proper functioning of the internal market or by setting a price tag on negative externalities, such as pollution. - Sufficiency; i.e. the resources used for financing the EU must be sufficient to cover the expenditure of the EU in the long run. As for individual own resources, their yield should be significant in relation to the size of the EU budget. - Cost-effectiveness; the administration costs should be low relative to the yield. - Stability; the resources should be reasonably stable over time. - Equity in gross contributions; i.e. the burden should be fairly shared among Member States as well as citizens. A more extensive presentation of these criteria can be found in annex I to this report. 3. Assessing the performance of the current own resources system To summarise the conclusions of this section, the current system has performed well as regards the criteria of sufficiency and stability, but clearly fails to fulfil the visibility and simplicity criterion and it does not contribute significantly to a more efficient allocation of economic resources. The financing system has grown increasingly complex over time, making it difficult even for the interested citizen to understand how it works. Financial autonomy is, furthermore, becoming increasingly limited. Although the financing of the budget is ensured by rules that are binding for all Member States, there is virtually no direct link to citizens or tax-payers. Instead the financing of the budget relies on transfers from national treasuries. As for the remaining criteria the current financing system has shown various shortcomings, as explained more in detail below. 3.1. Visibility and simplicity The current financing system is mainly and increasingly based on national contributions paid directly by the treasuries of Member States to the Commission and lacks a visible direct link to citizens. Most citizens do not know what they pay to the EU budget. This gives much scope for misperceptions of the costs and for a feeling of unfair burden-sharing. In the current system, traditional own resources (TOR) is the only direct link between the EU budget and the citizens, since they are levied directly on the economic agents paying the import duty. However, since it is a relatively small number of agents that bear the direct burden of the tax and since TOR only represent a very small part of total own resources, they do not contribute much to the visibility of the EU budget. The lack of a direct and visible link to the EU citizens also results in reduced accountability of the European Parliament, which might make it less sensitive to the cost of financing different policy measures. Furthermore, the current system has grown increasingly complex over time, making it difficult even for the interested citizen to understand how it works. The VAT resource is levied on a theoretical harmonised base in order to compensate for national derogations from Community VAT legislation and varying tax rates, requiring complicated calculations. Moreover, because of the tendency of the VAT base to be relatively higher in less prosperous Member States (i.e. the so-called regressivity of the VAT base), rules for limiting the base as a percentage of the national income ('capping') have been introduced. The VAT-based contribution from capped countries is therefore in practice based on their gross national income. The main reason for the lack of transparency of the system is, however, the UK correction. Not only is the correction mechanism itself highly complex, the amount of the correction also influences the rate of call of both the VAT and the GNI resource. Finally, in order to alleviate the net budgetary position of other large net contributors, some Member States have been granted a 'rebate on the rebate', i.e. a reduction on the financing of the correction, the cost of which is borne by the remaining Member States. 3.2. Financial autonomy The rules governing the financing of the budget are laid down in detail in the own resources decision and its different implementing provisions, which are binding for all Member States. The financing of expenditure is therefore guaranteed up to the own resources ceiling. This also means that the financing of the annual budget is completely technical with no room for political discussions. The budgetary authority's room of manoeuvre is extremely restricted, since the level and composition of revenue are largely determined by the own resources decision and by the strict application of the rule of budgetary balance. The financial sufficiency of the EU budget is ensured. As for financial autonomy from the treasuries of the Member States the picture is, however, quite different. Traditional own resources (TOR) currently represent the only truly fiscal own resources of the EU. They are collected by Member States on behalf of the EU, after deduction of 25 % of the amount collected. The percentage deducted represents an increase compared to the 10 % retained by Member States prior to 2001 (see also next section). As a result, the weight of these fiscal resources in the financing of the EU budget was reduced. TOR do, however, only represent around 10 % of total own resources. The other own resources are calculated as a percentage of statistical aggregates (GNI or the notional harmonised VAT base) and paid directly by the treasuries of Member States to the Commission. The GNI-resource, initially envisaged as the 'residual' resource to ensure a balanced budget, has in fact become the overwhelming source of revenue for the EU budget. The increasing dependence of the EU budget on inter-governmental transfers from national treasuries, accounting for almost 90 % of EU total revenue in later years, encourages Member States to seek to maximise ill-defined concepts of national benefit from the EU budget. Such a trend may well impair the future EU budget to adequately reflect the new challenges and needs to meet the legitimate expectations and concerns of all European citizens. In shaping a European Union with more than 25 Member States, narrow national interests will need to be pushed into the background, allowing instead for serious and more focused discussions about common European concerns. Increased autonomy of the EU budget from national treasuries would contribute to a more constructive approach to the benefits of the Union's policies. Financing the budget by contributions of the members is adequate for an international organisation. It does not necessarily reflect the status of the European Union and is in contradiction with the spirit of the treaty provision, introduced in 1970, whereby the Community budget should be financed by own resources. 3.3. Efficient allocation of economic resources As the current own resources are mainly levied directly on the treasuries of the Member States, they do not have a direct impact on the relative prices in the economy and the behaviour of the economic agents. It is only the traditional own resources (TOR) that have a direct impact on relative prices (on imported goods relative to goods produced in the Union) and therefore on the allocation decisions of the economic agents. TOR are, however, the result of common policies such as the customs union and the common agricultural policy and were not primarily introduced for the purpose of financing the EU budget. Due to the mismatch between the country collecting the duties and the country of residence of the economic agents bearing the economic burden of this tax it was then logical to attribute the corresponding revenue to the EU level. The introduction of a Common Customs Tariff has contributed to an efficient allocation of economic resources between Member States by creating a level playing field for import of goods into the Union. In this context it could also be mentioned that the increase from 10 % to 25 % in the percentage of traditional own resources retained by Member States was introduced irrespective of the actual collection costs. To a large extent it was the result of difficult negotiations about ways to correct excessive negative budgetary balances. The current level could, however, be seen as a useful incentive for Member States to collect TOR. On the other hand, it is not necessarily the Member States bearing the highest costs related to the protection of the external border of the Union that collect the duties and retain the corresponding 25 % of the collected amount. This is because customs operations are undertaken in stages in different Member States. Under the present system, Member States undertaking controls at the external frontier may be in a less favourable position than those Member States actually collecting the duties. In this regard, it is not surprising that some Member States have concluded bilateral agreements, especially in the context of simplified customs procedures, in order to share the 25 % compensation for the costs of collecting import duties in order to better reflect the actual collection and control costs. Although the present VAT-based resource has today in practice evolved into a national contribution, it earlier served as an impetus for establishing a common VAT system and therefore contributed to the proper functioning of the internal market. 3.4. Sufficiency and stability The present system has generated sufficient and stable resources to finance expenditure plans. The decline of traditional and VAT-based own resources is automatically compensated by the GNI-based resource, which guarantees financing up to the own resources ceiling of 1.24 % of total EU GNI. The margin available under the own resources ceiling in the current financial perspective is around 0.15 % of EU GNI for the whole 2000-2006 period. 3.5. Cost-effectiveness The collection of TOR and VAT is the duty of Member States. The collection of traditional own resources is cumbersome and demands significant administrative resources. However, import duties are primarily levied to protect producers in the Union [7] and not to finance the EU budget. The costs of collecting them should therefore only marginally be charged to the financing rules of the EU. Furthermore, if import duties were not to be attributed to the EU level, given the mismatch between the country collecting the duties and the country of residence of the economic agents bearing the economic burden of this tax, complex tax-sharing rules would normally have to be defined, which would entail additional costs. [7] Furthermore, in shaping its common commercial policy the Union does not act alone but in the multilateral context of the World Trade Organisation. The VAT-based resource imposes an additional workload on national administrations, since the harmonised VAT resources base is only calculated for the purposes of the EU budget. However, this can be considered as acceptable in relation to its potential yield. The administrative cost of the GNI resource is marginal, since it is incurred for the establishment of national accounts, irrespective of the EU budget. 3.6. Equity Equity may refer to the situation of individuals or to the fair burden-sharing among Member States. Since the budget is currently financed almost exclusively by contributions from Member States, the assessment here focuses on equity between Member States. As the ability to contribute to the EU budget can best be measured by a nation's national income, the increasing importance of the GNI [8] resource means that equity between Member States in the financing of the budget has improved over time. As the GNI resource now accounts for ¾ of total own resources in the 2004 budget, Member States' contributions are, generally speaking, becoming closely correlated to income levels across Member States. [8] Prior to 2002 the GNP (gross national product) resource. There is, however, one important exception to this rule. Due to the specific correction mechanism in its favour, the UK contributes clearly less than the other Member States in relation to its GNI. Furthermore, the UK correction also distorts equity indirectly since the financing of the correction by the other Member States is not proportional to GNI. The distorting effect of the UK correction is, furthermore expected to increase in the future due to enlargements of the Union. PART II - PREVENTING EXCESSIVE NEGATIVE BUDGETARY IMBALANCES 1. Introduction The European Union creates a community of solidarity with parts of the EU budget serving a clear cohesion goal, whereas other parts fund the achievement of specific objectives through EU agreed programmes. As a result, net beneficiaries of, and net contributors to, the EU budget will always exist, although the policy benefits accrue to the Union as a whole. Budgetary balances (also called net balances), measured by the difference between contributions to and receipts from the EU budget, fail to account fully for the benefits resulting from EU membership. For example, research or border protection expenditure benefits not only the immediate recipients but also gives rise to spill-over effects transcending national borders [9]. It may not be possible to quantify the extent of these spill-overs, but their consideration would modify the assessment of the accounting imbalances. [9] These spill-over effects include the spending of income generated in the receiving Member State on goods or services produced in another Member State, the purchase of financial asset denominated in various Member States currencies etc. The definition of budgetary balances is also fraught with significant conceptual and accounting problems. Numerous choices have to be made in computing budgetary balances on the items to be included in the receipts and expenditure flows, and on the reference periods (e.g. cash vs. accrual figures, surpluses from previous years, etc.). The resulting budgetary balances vary significantly depending on the choices made. Nevertheless, the size of some of these imbalances has been at the centre of discussions. After years of budgetary stalemate and agonizing discussions in 1984 the Fontainebleau European Council introduced the existing UK correction, which was then given effect by the own resources decision of 7 May 1985. The decision was based on the following general principle [10]: [10] See Fontainebleau European Council, 'Conclusions of the Presidency', Bulletin of the European Communities, 6-1984. '... any Member State sustaining a budgetary burden which is excessive in relation to its relative prosperity may benefit from a correction at the appropriate time.' The principle of a generalised correction was therefore already acknowledged by the European Council in 1984 ('any Member State'). The decision for granting a correction should be based on two criteria: the size of the budgetary imbalance ('excessive') and the wealth of a Member State compared to the EU as a whole ('relative prosperity'). The justifications for granting a correction on an exclusive basis to the UK are today less justified than at the time of the Fontainebleau European Council, since several other Member States can legitimately claim that their current situation is comparable to the UK's. Furthermore, the cost of enlargement should be fairly shared. Consequently, it is argued that, in light of the principle set in the Fontainebleau conclusions, the conditions exist for the introduction of a generalised correction mechanism. The parameters defining such a correction mechanism are examined and a proposal is made with the twin goals of: - preventing excessive negative budgetary balances combined with a reduction of differences between net contributors at comparable levels of prosperity; - ensuring that the financing costs of the mechanism are kept at a reasonable level. After briefly recalling the origin and main effects of the existing UK correction (Section 2), this report provides a brief analysis of the UK's relative prosperity and net budgetary balance in comparison with the other net contributors (Section 3). The subsequent sections of the report contain an analysis of the likely evolution of the UK correction till 2013 (Section 4) and examine proposals for a possible phasing out of that correction in its current form (Section 5). Section 6 defines the key parameters for a generalised correction mechanism and, finally, Section 7 proposes a new generalised mechanism to correct excessive negative budgetary imbalances. 2. The budgetary compensation for the United Kingdom 2.1. Origin of the mechanism The budgetary imbalance of the United Kingdom was at the centre of the political debate for about a decade (1974-1984), frequently provoking stalemates in the EU decision-making process. The question appeared immediately after the accession of the country to the European Community. The large negative budgetary balance of the UK at that time was essentially due to two factors: (a) an agricultural sector relatively smaller and structurally different from those of other Member States, which results in lower CAP spending in the United Kingdom; (b) a proportionally larger contribution to the financing of the EU budget [11]. [11] The United Kingdom had a relatively higher share in the harmonised VAT base than in the total GNP of the EU. At that time the VAT resource was the primary source of EU revenue. The GNI resource was introduced in 1988. Furthermore, it should be recalled that during the first years after its accession, the United Kingdom was one of the least prosperous Member States with a GDP per capita well below the EU average [12]. This tended to exacerbate the problem of the UK's negative budgetary balance. [12] In the five years preceding the introduction of the UK correction (1979-1983), only Ireland (and as of 1981 Greece) had a lower GDP per capita than the UK, expressed in purchasing power standards (PPS). The issue was finally settled at the Fontainebleau European Council of 1984 and the resulting rebate mechanism constitutes an integral part of the own resources decisions (ORD) taken subsequently. Being an integral part of the ORD, the UK rebate continues until modified or abolished by a new ORD. Modifications to the ORD require unanimity in Council and ratification by all national Parliaments. The rebate was reviewed in 1988, 1992 and 1999 and on all occasions the European Council decided to maintain it. 2.2. Description of the mechanism While technically very complicated to calculate, the underlying principle of the UK correction mechanism is quite simple: to reimburse to the UK 66% of its net contribution to the EU budget. In essence this is calculated in three steps. - The UK's percentage share in allocated expenditure (i.e. what the UK receives from the EU budget) is subtracted from the UK's percentage share in payments to the EU budget [13]. [13] These payments exclude payments of so-called traditional own resources, which are considered as resources that cannot be allocated to individual Member States. - This difference is multiplied by the total amount of allocated expenditure [14] to obtain a measure of the UK's net contribution to the EU budget. [14] Allocated expenditure includes all utilised appropriations for payments, with the exception of external expenditure (namely expenditure headings 4, 6 and 7 of the current financial perspective 2000-2006) and expenditure that cannot be reasonable allocated or identified. However, pre-accession expenditure relating to actual payments in the last year before accession of any acceding country is also deducted from allocated expenditure. - The result is multiplied by 0.66 (i.e. 66% percent of the whole net contribution is reimbursed). Most of the additional complications in the calculation arise from the fact that the overall contribution to the EU budget actually paid by the UK (including so-called traditional own resources and the UK correction) has to be equivalent to the overall contribution that the UK would have paid if the rules of the 1985 ORD (i.e. the rules that were applicable as a result of the Fontainebleau European Council) were still in force today. In practice this means that all subsequent modifications to the own resources system, introduced by successive ORD's, have to be neutralised through the calculation of the UK rebate. This includes the effect of the introduction of the GNP/GNI resource, the reduction of the VAT call rate, the capping of the VAT base and the increase of the traditional own resources collection costs [15]. [15] Besides the issues mentioned in this paragraph, the UK rebate also complicates the calculation of the VAT own resource through the mechanism of the so-called 'frozen' rate of call for VAT. While the original logic behind the 'frozen' rate disappeared in 1988 with the introduction of the GNP own resource, the mechanism continues to exist today. It now functions as a complicated and roundabout way to reduce the VAT own resource. The financing of the correction for a given year 't' is made up by all the Member States in accordance with their respective percentage shares in GNI payments in the year t+1, with the following exceptions: - the UK does not participate in the financing of its own rebate; - the share of DE, NL, AT and SE is restricted to 25% of the shares resulting from the calculation above. The difference is made up by the remaining 10 (20 since May 2004) Member States according to their share in GNI payments. 3. Current situation of the UK compared to other net contributors This section examines the relative prosperity and the size of the net budgetary balances for all net contributors to the EU budget. 3.1. Relative degree of prosperity The table below gives an overview of the gross national income (GNI) per capita expressed in purchasing power standards (PPS [16]) for the years 2003 and 1984 for all Member States that were net contributor in the year 2002 [17]. (The 2003 figures for all 25 Member States are presented in the annexed Table I. [16] The PPS is an artificial currency that reflects differences in national price levels that are not taken into account by exchange rates. This unit allows meaningful volume comparisons of economic indicators among countries. Data on PPS are calculated by Eurostat. [17] Net balances presented in this document, like those used for the UK correction, are calculated including administrative expenditure. For this reason, Belgium and Luxembourg do not appear among the net contributors. >SITIO PARA UN CUADRO> In 2003, GNI per capita of all net contributors to the EU budget, expressed in PPS, ranges between 97% and 111% of the EU-15 average. At 111.2%, the UK's relative prosperity is at the top of the range. This is in sharp contrast with the situation in 1984, when the UK was the least prosperous of the net contributors and only Greece and Ireland had a lower GNI per capita than the UK. In view of the considerable shift in the UK's position compared to the other net contributors, it is therefore necessary to reassess whether the UK correction mechanism as it stands is still justified in light of the Fontainebleau principle whereby a Member State's net balance should be viewed in relation to its relative prosperity. 3.2. Net budgetary balances before UK correction The net budgetary balance of the UK for the year 1985 (the first year for which the correction was calculated) amounted to -0.48% of GNI before correction. (Although accurate data are not available for the other Member States, Germany was the only other major net contributor to the EU budget at that time.) As illustrated in the table below, on average the UK's net balance has remained at a comparable level in recent years. Over the period 1996-2002 the net budgetary balance of EU-15 net contributors - before UK correction and including administrative expenditure - was on average the following: Table 2 Net budgetary balances before UK correction for EU-15 selected members (annual averages 1996-2002) // in % of GNI United Kingdom // -0.47% Germany // -0.44% Netherlands // -0.43% Sweden // -0.38% Austria // -0.24% Italy // -0.06% France // -0.04% Average net budgetary balances for the period 2008-2013 [18] will deteriorate for all net contributors across-the-board because of the financing cost of enlargement. According to internal Commission estimates and assuming expenditure levels equal to the financial perspective ceilings as proposed by the Commission in its communication of 10 February 2003 [19], the estimated net balances of the net contributors would be the following. (The figures for all 25 Member States are presented in the annexed Table II). [18] The net balances for the period 2007-2013 have been estimated on the basis of the expenditure level (payment appropriations) as proposed by the Commission for the EU-27. Where feasible, the allocation across Member States was based on a detailed calculation on the basis of an established methodology (e.g. cohesion expenditure). In other cases, an indicative breakdown was used on the basis of historical data. Expenditure for the 10 new Member States that acceded on 1 May 2004 was calculated according to an identical methodology as for the EU-15, except for the phasing-in of the EAGGF Guarantee direct payments. Expenditure for Bulgaria and Romania is included in a manner which is coherent with the Commission communication Financial package for the accession negotiations with Bulgaria and Romania, SEC(2004) 160/4 adopted on 10 February 2004. [19] COM(2004) 101 final. Table 3 Estimated net budgetary balances before UK correction for EU-15 selected members (annual averages 2008-2013 [20]) [20] As corrections are reimbursed one year later, averages in this table and the following ones are calculated over a six-year period since the 2007 correction is paid in 2008 and the 2013 correction takes place in 2014. // in % of GNI United Kingdom // -0.62% Netherlands // -0.55% Germany // -0.52% Sweden // -0.47% Austria // -0.37% Italy // -0.29% France // -0.27% Denmark // -0.20% Finland // -0.14% Under the assumption that the level of agricultural expenditure for the EU-25 agreed by the Brussels European Council in October 2002 and the 'cohesion' expenditure proposed by the Commission under the so-called Objective 1 and Cohesion fund remained unchanged, a reduction of the overall level of payment appropriations from the 1.14% of GNI proposed by the Commission to, say, 1.00%, would only have a very limited impact on the size of the estimated net balances. This is because the expenditure for the new Member States would in essence not be touched and the reduction could only be achieved by drastically cutting the other non-agricultural expenditure going to the EU-15 and/or external expenditure that does not enter in the calculation of net balances. As a consequence, the resulting reduction of own resources payments for the net contributors would to a large extent be offset by a corresponding reduction in EU allocated expenditure in these same Member States. In the absence of any correction mechanism, the UK would have been on average the largest net contributor over the last 7 years, and would probably remain the largest net contributor to the EU budget over the period 2007-2013. However, the net balances of NL, DE and, to a lesser extent, SE have been and are expected to remain of a comparable order of magnitude. As shown in the previous section, all these three Member States are currently relatively less prosperous than the UK. Whether the size of net budgetary balances is 'excessive' in view of the relative prosperity of the Member States concerned largely depends on the political perception of the acceptable degree of financial solidarity within the Union. If the UK net balance was judged 'excessive', then the application of the Fontainebleau principle would rather point to the extension of a correction mechanism to other Member States, who - at lower levels of prosperity - bear negative net balances of a similar order of magnitude. In any event, granting a correction on an exclusive basis to only one Member State appears to be unjustified, especially when taking into account the expected evolution of net budgetary balances in the enlarged Union under unchanged conditions, as illustrated in the next section. 4. Estimated net balances with unchanged Own Resources Decision Estimates indicate that over the period 2007-2013 the UK correction will increase by more than 50% compared to the average over the latest 7 years to reach an estimated EUR 7.1 billion from EUR 4.6 billion in the period 1997-2003. Although the envisaged enlargement to 10 new Member States was unanimously agreed at the Berlin European Council in March 1999, the UK insisted and obtained that enlargement-related expenditure be taken into account [21] when calculating the UK correction, thus shielding it from most of the financial consequences of enlargement. That is the main reason for the expected future increase in the UK correction. [21] Pre-accession expenditure relating to actual payments in the last year before accession of any acceding country is permanently deducted from the allocated expenditure. As a consequence, the cost for the Member States that pay a full share in the financing of the UK correction, including all the new Member States, will increase proportionally. The average estimated financing cost over the period 2008-2013 for all 25 Member States is presented in the annexed Table IV. Should the current own resources decision remain in force, the average net balance for the net contributors over the 2007-2013 period after UK correction is estimated as follows (Table III in annex II provides estimates for all 25 Member States): Table 4 Estimated net budgetary balances after UK correction for all expected net contributors (annual averages 2008-2013) // in % of GNI Netherlands // -0.56% Germany // -0.54% Sweden // -0.50% Italy // -0.41% Austria // -0.38% Cyprus [22] // -0.37% [22] Throughout this document estimates are based on areas controlled by the Republic of Cyprus. France // -0.37% Denmark // -0.31% Finland // -0.25% United Kingdom // -0.25% According to these estimates, the UK will become (together with Finland) the smallest net contributor to the EU budget, therefore clearly departing from the Fontainebleau principle mentioned above. The persistence of such a growing anomaly risks undermining the legitimacy of EU policies in general, particularly in new Member States. The current system of a unique correction for the UK therefore cannot continue. Instead, the generalization of the correction mechanism, evolving from the existing correction would allow bringing the system closer to the original objective of avoiding excessive budgetary burdens in relation to the relative prosperity of Member States. By introducing a sort of 'safety net' for large net contributors beyond a certain level, it may also facilitate a more constructive approach to ensure the budgetary means necessary to meet the policy challenges of the enlarged Union. 5. Reduction or phasing-out of the UK correction 5.1. Estimated net balances with a reduction of the refund rate One simple way to rectify the expected 'overshooting' of the UK correction would be to reduce the reimbursement percentage from 66% to - for instance - 33%. The results in terms of net budgetary balances, expressed as a percentage of each Member State's GNI are summarised below for the net contributors: Table 5 Estimated net budgetary balances after UK correction with refund rate reduced to 33% for all expected net contributors (annual averages 2008-2013) // in % of GNI Netherlands // -0.55% Germany // -0.53% Sweden // -0.48% United Kingdom // -0.46% Austria // -0.38% Italy // -0.34% Cyprus [23] // -0.32% [23] Estimates based on areas controlled by the Republic of Cyprus. France // -0.32% Denmark // -0.25% Finland // -0.19% The UK's net contribution would be more in line with that of other net contributors, although it would remain rather low in comparison with some of the other net contributors that have lower levels of relative prosperity. Among these net contributors, F and I would benefit most from a reduction of the rebate since these countries unlike AT, DE, NL and SE do not benefit from a reduction in their financing share of the UK correction. Conversely, the net position of NL, DE and SE hardly improves. A reduction of the UK rebate would therefore not address the perceived excessive net balances of these Member States. Furthermore, it would perpetuate the situation whereby one Member State continues to receive a correction on an exclusive basis, while others in an almost identical, or relatively worse, situation do not. 5.2. Estimated net balances with the UK correction frozen at its current level An alternative to the reduction of the refund rate could be to freeze the amount of the correction at a certain level. For instance, the UK correction could be frozen at the level actually enjoyed by the UK on average over the period 1996-2002, which is around EUR 4.5 billion. However, as the result would be comparable to a reduction of the refund rate, the same disadvantages would persist. Table 6 Estimated net budgetary balances after UK correction with UK correction frozen at its current level for all expected net contributors (annual averages 2008-2013) // in % of GNI Netherlands // -0.55% Germany // -0.53% Sweden // -0.49% United Kingdom // -0.38% Austria // -0.38% Italy // -0.37% Cyprus [24] // -0.34% [24] Estimates based on areas controlled by the Republic of Cyprus. France // -0.34% Denmark // -0.27% Finland // -0.21% 5.3. Estimated net balances with a phasing-out of the UK rebate Phasing-out the UK rebate over the period covered by the next financial perspective, as advocated by certain Member States, would certainly be the easiest solution to limit the unintended effects of the existing UK correction. In its simplest form, this could be done by leaving the calculation method unchanged, while progressively reducing the result by a given percentage over a certain number of years, say over seven years. Thus, the 2007 rebate (to be paid and financed in 2008) could amount to 6/7th of the amount obtained according to the current calculation method, the 2008 rebate to 5/7th and so on. The 2012 rebate, to be paid and financed in 2013, would amount to 1/7th of the normal calculation. In this example it would also constitute the last correction. The estimated net balances of the net contributors over the period 2007-2013 resulting from such a phasing-out regime are presented below: Table 7 Estimated net budgetary balances after UK correction with a linear phasing-out of the UK correction over 7 years for all expected net contributors (annual averages 2008-2013) // in % of GNI Netherlands // -0.55% Germany // -0.53% Sweden // -0.49% United Kingdom // -0.43% Austria // -0.38% Italy // -0.35% Cyprus [25] // -0.32% [25] Estimates based on areas controlled by the Republic of Cyprus. France // -0.32% Denmark // -0.26% Finland // -0.19% However, it should be borne in mind that the figures in the table above represent the average for the phasing-out period. After the period under consideration, the UK would no longer benefit from any correction mechanism. The phasing-out of UK correction would have only a minor impact on the net balances of the other large net contributors, since they are to a large extent protected from the financing cost of the UK rebate. Therefore, this alternative would not solve the problem of the 'excessive' net balances of the other net contributors. 5.4. Estimated net balances with a phasing-out of the frozen UK correction Alternatively, as advocated by certain Member States, the UK correction could be frozen at an agreed level (for instance EUR 4.5 billion, equivalent to the average over the period 1996-2002) and then phased-out linearly over a number of years. This is the equivalent of combining the effects discussed in Sections 5.2 and 5.3 above. The disadvantages mentioned in the previous paragraphs would remain unchanged. Table 8 Estimated net budgetary balances after UK correction with a linear phasing-out of the frozen UK correction over 7 years for all expected net contributors (annual averages 2008-2013) // in % of GNI Netherlands // -0.55% Germany // -0.53% United Kingdom // -0.50% Sweden // -0.48% Austria // -0.37% Italy // -0.33% Cyprus [26] // -0.31% [26] Estimates based on areas controlled by the Republic of Cyprus. France // -0.31% Denmark // -0.23% Finland // -0.17% 5.5. Estimated net balances with enlargement-related expenditure excluded from the calculation of the UK correction The calculation of the UK correction takes into account all the expenditure that is 'internal' to the EU and that can reasonably be allocated to an individual Member State [27]. Expenditure in the new Member States is also taken into account, with the exception of a small correction related to the amount of the pre-accession expenditure in the year before accession. The expenditure in the new Member States is the principal cause of the expected 50% increase in the size of the UK correction. It is therefore appropriate to consider the effect of continuing the current system while fully excluding the expenditure in the new Member States from the calculation. [27] This issue is discussed under Section 6.2. This approach would have the advantage of at least assuring fair burden sharing between all Member States of the cost related to the current and the future enlargements of the EU. If the expenditure going to the 12 new Member States would be excluded, the UK correction is expected to be on average reduced to EUR 4.2 billion over the period 2007-2013. The results in terms of net budgetary balances, expressed as a percentage of each Member State's GNI are summarised below for the net contributors: Table 9 Estimated net budgetary balances after UK correction with enlargement-related expenditure excluded for all expected net contributors (annual averages 2008-2013) // in % of GNI Netherlands // -0.55% Germany // -0.53% Sweden // -0.49% United Kingdom // -0.39% Austria // -0.38% Italy // -0.37% Cyprus // -0.33% France // -0.33% Denmark // -0.27% Finland // -0.21% The net balances of DE, AT, SE and NL would only be affected in a very marginal way compared to the situation under the unchanged own resources decision, since these countries pay only 25% of their normal financing share of the financing of the UK correction. Again, such a solution would not solve the problem whereby only 1 Member State would be eligible for a correction, while others at comparable or lower levels of relative prosperity and bearing negative net balances of similar size would continue to be excluded. Furthermore, it would effectively create in a durable way two categories of EU expenditure (within the EU-15 and in the new Member States). 6. Parameters of a generalised correction mechanism 6.1. Introduction The proposed generalised correction mechanism has to be seen in the context of the Commission overall 'package' for the post-2006 financial framework. The final outcome is thus likely to be affected by decisions to be taken on the expenditure side of the package. If it is accepted that the net contributions of certain Member States are excessive, then none of the alternatives presented in Sections 3 through 5 namely, unchanged own resources decision, abolishing, reducing or phasing-out the UK correction - seems to generate acceptable results in terms of equitable burden sharing among Member States. That is why the Commission proposes to introduce a generalised corrective mechanism. The generalised correction mechanism is a tool for correcting 'excessive' net budgetary balances in an own resources system primarily financed through contributions from the Member State's treasuries. Any substantial changes to the own resources system (see Part III of this report), would of course require a re-assessment of the need for a corrective mechanism. A generalised correction mechanism would be calculated on the basis of the net budgetary balance of each Member State in relation to the budget of the EU. The mechanism should be triggered beyond a threshold, expressed as a percentage of each Member State's GNI, reflecting the minimum accepted level of unlimited financial solidarity between Member States and representing a sort of basic reasonable net contribution. Net positions exceeding such a threshold will be eligible for a correction (partial refund). The amount of the correction is to be based on the part of the net balance exceeding this threshold, multiplied by a refund rate (i.e. the percentage of the amount in excess of the agreed threshold to be compensated). The amount corresponding to the sum of all corrections could be capped at a total predetermined volume. The net balance would be calculated on the basis of a zero-sum situation, i.e. the sum of the net balances of all Member States should be equal to zero [28]. (This principle is also applied in the calculation of the UK correction.) [28] For a discussion of the different types of net balances and their calculation methods, see the Commission's 1998 own resources report, Annex 3. 6.2. Categories of expenditure to be taken into account The current definition of allocated expenditure used in the calculation of the UK rebate as well as the Commission's yearly report on the allocation of expenditure to Member States is based on the principle whereby all expenditure for which it can reasonably be shown that the recipient is a resident of a certain Member State is being allocated to that Member State. Recipients are not limited to public bodies but also include private firms, individuals, etc...The allocation is limited to the first round effect [29]. The Commission recognises that this instrument is an imperfect tool and that certain problems of correct allocation continue to exist [30]. [29] This means the Commission does not include possible second-round effects into the allocation. Often cited examples of these effects are for instance the possible repatriation of profits by foreign firms or consortia involved in cohesion projects and salaries of European officials residing in Belgium or Luxembourg that is not necessarily exclusively spent in these countries. [30] Although the Commission is constantly trying to refine the data to improve the quality of the allocation, a number of problems continue to persist. Agricultural export subsidies for instance are allocated to the country exporting the goods, an allocation method which tends to unduly increase the expenditure allocated to gateway countries such as Belgium and the Netherlands. Likewise it is not always easy to identify exactly the final beneficiary of certain payments made to international consortia, for example for research expenditure. Since these consortia often have their administrative base located near the EU institutions, an exaggerated share in this type of expenditure may be allocated to Belgium and Luxembourg. According to this definition, allocated expenditure includes all categories of expenditure that are 'internal' to the EU. This includes virtually the total amount of expenditure headings 1 (agriculture) and 2 (structural operations) as well as the vast majority of expenditure under headings 3 (internal policies) and 5 (administration), excluding only some minor items of expenditure that cannot be reasonably allocated to any individual Member State [31]. Headings 4 (external policies), 6 (reserves) and 7 (pre-accession expenditure) relate explicitly to 'external' expenditure and are therefore not taken into account when calculating the net budgetary balance of a Member State. [31] In terms of the newly proposed expenditure headings in the Commission communication of 10 February 2003, this corresponds roughly with the content of the new headings 1a, 1b, 2, 3 and administrative expenditure. It has on occasion been argued that certain categories of this internal expenditure should be fully or partially excluded from the calculation of the net balances. The arguments advanced to defend this are based on perceived conceptual and practical difficulties related to expenditure allocation. However, it should be noted that, while the European Council has reviewed the calculation method of the UK correction on several occasions, it has each time decided to keep the expenditure categories included in the calculation unchanged. Indeed, excluding any of these expenditure categories would constitute a different approach than the basic principle evoked at the beginning of this section. That is why the Commission proposes to keep the current accepted definition unchanged [32]. Thus, all expenditure that can reasonably be allocated to an individual Member State (i.e. broadly speaking, the headings 1, 2, 3 and 5 under the 2000-2006 financial perspective) would continue to be taken into account for the calculation of the net budgetary balance in the context of the proposed generalised correction mechanism. [32] The only envisageable amendment concerns the agricultural export refunds which could be excluded on the grounds that there is no clear link between the port of exit and the final beneficiary of these interventions. A similar argument is used to exclude traditional own resources from the revenue to be taken into account (cf. section 6.3). 6.3. Categories of revenue to be taken into account The calculation of the UK rebate excludes the traditional own resources (TOR) from the categories of revenue to be taken into account. This is justified for 2 reasons. First, TOR are not considered to be a Member State contribution but constitute revenue belonging to the EU by virtue of the customs union. Second, TOR are often levied at the port of entry into the EU in application of the Common Customs Code. Since the final consumer of the imported goods does not necessarily live in the country of the port of entry there is no clear geographical link between the collection of the duties and the economic burden they represent. TOR should therefore continue to be excluded in any future proposal to introduce a generalised correction mechanism. Consequently, the combined share in VAT and GNI own resources would be used as the proper base to calculate any Member States' share in EU budgetary revenue. A proposal for a generalised correction mechanism should be as simple and transparent as possible. Therefore all existing complications in the UK rebate calculation which are related to the preservation of the UK's 1984 revenue position (share in uncapped VAT, calculating the 'advantage' as well as the 'TOR windfall gains'), should be abolished. 6.4. The level of the threshold 6.4.1. Fixed threshold Simulations have been run for different levels of the threshold (using a refund rate of 66%) ranging from zero to 0.50% of GNI. The results are summarised in the annexed Tables V through IX [33]: [33] A minus (-) sign means an increase of a Member State's total own resources payments compared to the estimated future (2008-2013 average) situation under an unchanged own resources decision. Conversely a plus (+) sign means a reduction in total own resources payments for the Member State concerned. - Table V: estimates of the level of the gross corrections; - Table VI: estimates of the financing of the corrections; - Table VII: estimates of the net level of the corrections (= sum of tables V + VI); - Table VIII: estimates of the impact of introducing a GCM compared to the situation with unchanged own resources decision; - Table IX: estimates of the net budgetary balances as a percentage of GNI; The total sum of the corrections at different threshold levels is estimated as follows (details for individual Member States are presented in Table V): Table 10 Estimated gross corrections (average 2008-2013) Level of the threshold (as a % of GNI, EU-27) // Sum of all corrections (in billion of euros) 0.00% // 25.8 0.10% // 19.8 0.20% // 13.8 0.25% // 11.1 0.30% // 8.8 0.40% // 5.2 0.50% // 1.9 A threshold level of around -0.25% would represent a sort of neutral point whereby the estimated future cost of financing the generalised correction mechanism would be equal to the estimated future cost of financing the current UK correction mechanism. This is illustrated in Table V in annex II: the effect of introducing a GCM is zero or close to zero at a threshold of 0.25% for all Member States that are currently financing a full share in the UK correction [34]. A threshold lower than 0.25% would mean that the Member States paying in full the UK rebate (they currently bear more than 90% of the total cost) would have to pay more than the estimated cost of financing the current UK correction mechanism in the future. With thresholds higher than 0.25% the mechanism would become less costly for those Member States, including all net recipients from the EU budget, than financing the estimated future UK correction mechanism. [34] This is valid for all Member States that do not receive a gross correction and therefore only participate in the financing. However, as can be observed in Table V in the annex, at a threshold of 0.25% a few of the 20 Member States that currently pay a full share in the financing of the UK correction would actually receive a gross correction. Consequently, as illustrated in Table VIII, these Member States would still be better off at 0.25% compared to the future cost of financing the UK correction. The table above (as well as the annexed Table V) illustrates that the total sum of the corrections with a 0.25% threshold would be substantially higher than the estimated level of the future UK correction with the current own resources decision (ORD) unchanged. Applying a threshold of -0.25% would generate a level of (gross) corrections slightly above EUR 11 billion, which is significantly higher than the approximately EUR 7 billion average (net) UK correction for the same period. This difference is linked to the assumption that the financing of the corrections would be shared by all Member States according to their share in GNI (see section 6.7 below). Thus, for those Member States who would not benefit from the GCM, an overall volume of up to EUR 11 billion of corrections could be financed before the GCM became more expensive than the continuation of the current ORD. The impact of introducing a generalised mechanism with a threshold is not linear. The effect on Member States' net balances, compared to the current situation, is influenced by a combination of the following three elements: a) the level of the Member States' budgetary imbalance before correction; b) the level of the threshold; and c) the financing rules under the existing UK correction. The estimated impact is shown in the annexed Table VIII on the basis of which the following observations can be made: - Net beneficiaries from the budget do not receive any corrections, regardless of the threshold level. As previously indicated, the cost of financing the correction mechanism becomes more expensive for these countries compared to the future financing cost of the UK correction at threshold levels lower than 0.25%. - All major net contributors to the EU budget (UK, DE, NL, SE) would benefit from the correction mechanism with thresholds lower than or equal to 0.50% of GNI. - Smaller net contributors would receive corrections depending on the threshold level. The relative position of each individual net contributor, compared to their estimated future position under the current ORD, is determined by a combination of the following two factors: - the size of the negative net balance before correction, whereby larger net contributors such as DE, NL, SE tend to benefit more at lower threshold levels (compared to smaller net contributors); - the current financing regime of the UK correction, whereby Member States currently benefiting from a special arrangement (DE, NL, SE, AT) tend to benefit less at higher threshold levels (compared to smaller net contributors). - The case of AT merits a specific mention since it illustrates the mechanism at work here. Since this Member State is expected to be a smaller net contributor than NL, DE and SE, it would receive smaller corrections (comparable to the corrections received by FR and IT). However, as it would lose the 75% reduction in the financing of the UK correction (whereas countries such as FR and IT do not enjoy such a reduction at present) it would see its net balance deteriorate at higher threshold levels (compared to the estimated situation with unchanged own resources decision). - The UK would experience a deterioration of its net balance at any threshold level, even in the situation where there is no threshold at all. In this case the UK would receive a correction of an order of magnitude similar to the current UK correction but it would have to participate in the financing of both its own and the other Member States' corrections. It is worth recalling that the deterioration of the UK net balance illustrated in the tables above is in comparison with the UK's estimated future position, i.e. in comparison with the situation where the UK is expected to become the smallest net contributor to the EU budget. Any future 'fairer' mechanism should ensure in particular that the resulting financing cost does not lead to a heavier burden than under the current UK correction mechanism for 'cohesion' Member States. 6.4.2. Variable threshold It is possible to include an element of progressivity into the correction mechanism by introducing a variable threshold related to the relative prosperity of each Member State rather than the fixed threshold illustrated in the previous