Preliminary Draft Amending Budget No 8 to the general budget for 2004 - General statement of revenue
Date: 2004-05-28
Institutions: Directorate-General for Budget, European Commission
Subjects: amending budget, budgetary resources, general budget (EU), preliminary draft EC budget

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 28.5.2004 
SEC(2004) 675 final 

PRELIMINARY DRAFT AMENDING BUDGET No 8 
 TO THE GENERAL BUDGET FOR 2004 

GENERAL STATEMENT OF REVENUE 

(presented by the Commission) 

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PRELIMINARY DRAFT AMENDING BUDGET No 8 
 TO THE GENERAL BUDGET FOR 2004 

GENERAL STATEMENT OF REVENUE 

Having regard to: 

- 

- 

- 

the  Treaty  establishing  the  European  Community,  and  in  particular  Article 272 
thereof, 

the  Treaty  establishing  the  European  Atomic  Energy  Community,  and  in  particular 
Article 177 thereof, 

the Council Regulation (EC, Euratom) No 1605/2002 of 25 June 2002 on the Financial 
Regulation  applicable  to  the  general  budget  of  the  European  Communities1,  and  in 
particular Article 37 thereof, 

The  European  Commission  hereby  presents  to  the  budgetary  authority  the  preliminary  draft 
amending  budget  No 8  to  the  2004  budget  for  the  reasons  set  out  in  the  explanatory 
memorandum. 

1  

OJ L 248, 16.09.2002, p.1. 

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TABLE OF CONTENTS 

EXPLANATORY MEMORANDUM 

1. 

2. 

3. 

Introduction .................................................................................................................. 4 

Revision of the forecasts of Import Duties, VAT bases & GNI .................................. 6 

Correction of budgetary imbalances in favour of the United Kingdom (2000 and 
2003) ............................................................................................................................ 8 

3.1. 

Calculation of the corrections ...................................................................................... 8 

3.1.1.  Update of the correction for 2003 ................................................................................ 9 

3.1.2.  Final calculation of the correction for 2000............................................................... 10 

3.2. 

Entry in the 2004 budget of the updated estimate for 2003 and the final amount of the 
2000 correction........................................................................................................... 11 

3.2.1.  Amount to be budgeted (chapter 15).......................................................................... 11 

3.2.2.  Financing of the corrections to be budgeted (chapter 15).......................................... 11 

3.2.3.  Result of the definitive calculation of the financing of the 2000 correction 

(chapter 35) ................................................................................................................ 12 

GENERAL STATEMENT OF REVENUE 

The  general  statement  of  revenue  is  forwarded  separately  via  the  SEI-BUD  system.  A 
language version is attached as a technical annex by way of example. 

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1. 

INTRODUCTION 

EXPLANATORY MEMORANDUM 

The  Preliminary  Draft  Amending  Budget  No  8  to  the  Budget  for  2004  covers  the 
following points: 

– 

– 

The  revision  of  the  forecasts  of  Agricultural  Duties,  Customs  Duties,  VAT 
bases  and  GNI  and  the  budgeting  of  the  UK  corrections  as  well  as  their 
financing, resulting in a change in the distribution between Member States of 
the contributions to the Communities' own resources. 

Article 7 of the Council Decision 2000/597/EC, Euratom on the system of the 
European  Communities'  own  resources  states  that  "  …surplus  from  the 
Guarantee  Fund  arising  from  external  measures,  transferred  to  the  revenue 
account  in  the  budget,  shall  be  regarded  as  constituting  own  resources  ".  In 
addition to the revision of the forecasts of own resources, this PDAB enters the 
repayment  of  the  surplus  from  the  Guarantee  Fund  for  external  measures 
related to 2003. This amounts to € 223 160 000. 

The  following  summary  table  shows  the  distribution  of  own  resources  between 
Member  States  as  budgeted  in  the  Amending  Budget  (AB)  1/2004  (that  adapts  the 
2004  budget  to  the  accession  of  10  new  Member  States  on  1  May  2004),  in  the 
PDAB 7/2004 and as affected by the PDAB 8/2004. 

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AB 1/2004 
Financing by 
MS 
(total own 
resources) 
(1) 
3 746 633 291 
544 180 062 
2 059 502 022 
21 862 157 382 
57 103 718 
1 737 153 959 
8 196 835 735 
16 789 029 661 
1 265 596 215 
13 664 366 165 
89 217 635 
66 864 257 
125 870 309 
218 035 105 
559 899 012 
34 657 146 
5 455 232 508 
2 213 930 520 
1 344 201 846 
1 439 237 572 
190 863 480 
239 926 878 
1 488 720 549 
2 684 146 933 
12 845 366 179 
98 918 728 139 

PDAB 7/2004 
Financing by MS 
(total own 
resources) 

(2) 
3 592 492 644 
517 005 093 
1 953 265 586 
20 673 315 915 
54 335 346 
1 648 712 733 
7 781 068 653 
15 906 825 633 
1 201 207 761 
12 935 536 635 
84 835 926 
63 382 758 
119 910 611 
206 638 258 
533 579 968 
33 060 852 
5 198 545 914 
2 091 147 956 
1 275 133 727 
1 365 306 164 
181 113 733 
228 122 139 
1 408 095 670 
2 536 489 343 
11 930 558 555 
93 519 687 573 

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EE 
EL 
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FR 
IE 
IT 
CY 
LV 
LT 
LU 
HU 
MT 
NL 
AT 
PL 
PT 
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SK 
FI 
SE 
UK 
Total 
EU-25 

PDAB 8/2004 
Financing by 
MS 
(total own 
resources) 
(3) 

PDAB 8/2004 
Financing by 
MS 
(total own 
resources) 
(4) = (3) in % 

3 734 143 338 
553 658 570 
1 933 350 558 
20 477 217 068 
57 682 994 
1 689 325 589 
8 077 038 039 
15 941 680 589 
1 205 526 218 
13 208 025 402 
84 550 436 
64 579 847 
125 454 445 
218 354 843 
548 711 285 
33 469 206 
5 120 425 047 
2 098 850 690 
1 239 542 057 
1 326 825 420 
176 601 415 
223 430 208 
1 420 210 787 
2 604 459 430 
11 133 414 092 
93 296 527 573 

4.00 % 
0.59 % 
2.07 % 
21.95 % 
0.06 % 
1.81 % 
8.66 % 
17.09 % 
1.29 % 
14.16 % 
0.09 % 
0.07 % 
0.13 % 
0.23 % 
0.59 % 
0.04 % 
5.49 % 
2.25 % 
1.33 % 
1.42 % 
0.19 % 
0.24 % 
1.52 % 
2.79 % 
11.93 % 
100.00 % 

amounts in euro 

Difference 
PDAB 8/2004 
vs. 
PDAB 7/2004 

Difference 
PDAB 8/2004 
vs. 
AB 1/2004 

(5) = (3) – (2) 
141 650 694 
36 653 477 
-19 915 028 
-196 098 847 
3 347 648 
40 612 856 
295 969 386 
34 854 956 
4 318 457 
272 488 767 
-285 490 
1 197 089 
5 543 834 
11 716 585 
15 131 317 
408 354 
-78 120 867 
7 702 734 
-35 591 670 
-38 480 744 
-4 512 318 
-4 691 931 
12 115 117 
67 970 087 
-797 144 463 

-223 160 000 

(6) = (3) – (1) 

-12 489 953 
9 478 508 
-126 151 464 
-1 384 940 314 
579 276 
-47 828 370 
-119 797 696 
-847 349 072 
-60 069 997 
-456 340 763 
-4 667 199 
-2 284 410 
-415 864 
319 738 
-11 187 727 
-1 187 940 
-334 807 461 
-115 079 830 
-104 659 789 
-112 412 152 
-14 262 065 
-16 496 670 
-68 509 762 
-79 687 503 
-1 711 952 087 

-5 622 200 566 

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2. 

REVISION OF THE FORECASTS OF IMPORT DUTIES, VAT BASES & GNI 

According to established practice the Commission proposes to revise the financing of 
the budget on the basis of more recent economic forecasts, adopted at a meeting of 
the Advisory Committee on Own Resources (ACOR) that is normally held in April 
each year. 

The  revision  concerns  the  forecast  of  agricultural  duties  and  customs  duties  to  be 
collected  in  the  current  budgetary  year  as  well  as  of  the  current  year’s  VAT  bases 
and GNI. The forecast in the AB 1/2004 was established at the 128th ACOR meeting 
on 23 April 2003. The present revised forecasts were adopted at the meeting of the 
131st  ACOR  meeting  on  20  April  2004.  The  use  of  updated  forecasts  of  own 
resources  improves  the  accuracy  of  the  payments  that  Member  States  are  asked  to 
make during the budgetary year2 and reduces the unavoidable forecasting errors from 
the previous year. 

As  compared  to  the  forecasts  agreed  in  April  2003  for  the  AB  1/2004,  the  4 
aggregates subject to revision in the present PDAB are revised as follows: 

•  Total EU-25 agricultural duties for 2004 are now forecast at € 865.1 million (after 
deduction of 25 % in collection costs), which represents an increase by +0.71 % 
relative to the forecast of € 859.0 million in the AB 1/2004. Forecast agricultural 
duties  for  EU-15  countries  were  unchanged.  It  is  only  the  forecast  agricultural 
duties  for  the  Acceding  Countries  which  were  revised  upward  by  +22.0 %  from 
€ 27.9 million to € 34.0 million. The main reason for this revision is a substantial 
growth of extra EU-25 imports of Acceding Countries from 2002 to 2003 (from 
€ 51.1 million to € 54.5 million), while the weighted average tariff decreased only 
slightly from 1.74 % down to 1.72 %. 

•  Total EU-25 customs duties for 2004 are now forecast at € 9 981.8 million (after 
deduction  of  25 %  in  collection  costs),  which  represents  a  decrease  by  -1.7 % 
relative to the forecast of € 10 154.9 million in the AB 1/2004. The main reasons 
for this decrease are a substantial reduction of the forecast growth rate 2003-2004 
of extra EU-15 imports for EU-15 countries (from 6.1 % down to 4.8 %) and to a 
lesser extent a reduction of the EU-15 weighted average tariff from 1.59 % down 
to  1.55 %.  The  forecast  of  EU-15  customs  duties  was  consequently  revised 
downward  by  -1.9 %  from  € 9 850.0  million  to  € 9 665.0  million.  It  has  to  be 
noted  (though  it  had  a  more  reduced  impact)  that,  on  the  contrary,  forecast 
customs  duties  of  Acceding  Countries  were  revised  upward  by  +3.9 %  from 
€ 305.0  million  to  € 317.0  million  (see  explanation  in  paragraph  above,  as 
customs  duties  and  agricultural  duties  were  forecast  jointly  for  Acceding 
Countries). 

2 

Please note that – in the case of the 10 Acceding Countries - VAT bases and GNI have been reduced by 
one third to take into account the fact that, for these resources, Acceding Countries will only contribute 
to the EU budget during 8 months in 2004 (i.e. from May to December after accession on 1 May). For 
traditional own resources, which are paid with a two-month delay, a one half reduction (corresponding 
to 6 months payments from July to December 2004) has been applied. 

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•  The EU-25 uncapped VAT base at current market prices is forecast to amount to 
€ 46 713.0 million in 2004 at a 1 % rate, which represents an increase of +0.9 % 
compared to the € 46 301.4 million entered in the AB 1/2004. The EU-25 capped 
VAT base3 at current market prices is forecast to amount to € 45 507.3 million in 
2004  at  a  1 %  rate,  which  represents  an  increase  of  +0.1 %  compared  to  the 
€ 45 454.3 million entered in the AB 1/2004. 

•  The  EU-25  GNI  at  current  market  prices  is  forecast  to  amount  to  € 98 980.9 
million in 2004 at a 1 % rate, which represents a decrease by -0.9 % compared to 
the € 99 890.9 million entered in the AB 1/2004. 

The exchange rates of 31 December 2003 have been used for converting the forecast 
VAT bases and GNI into euro (for the thirteen Member States that are not members 
of the euro zone). This avoids distortions since it is this rate which is used to convert 
budget estimates from euro into national currency when the amounts are called in (as 
stipulated in Article 10(3) of Council Regulation No 1150/2000). 

The revised forecasts of agricultural duties, customs duties, uncapped VAT bases and 
GNI for 2004, as adopted at the 131st ACOR meeting on 20 April 2004, are set out in 
the following table: 

Revised forecasts of customs duties, VAT bases & GNI for 2004 (in €) 

Agricultural duties 
(75 %) 

Customs duties
(75 %) 

Uncapped VAT base
(at a 1 % rate) 

GNI 
(at a 1 % rate) 

Capped VAT base3
(at a 1 % rate) 

BE 
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DE 
EE 
EL 
ES 
FR 
IE 
IT 
CY 
LV 
LT 
LU 
HU 
MT 
NL 
AT 
PL 
PT 
SI 
SK 
FI 
SE 
UK 
Total EU-25 

16 125 000
5 775 000
5 175 000
101 550 000
900 000
8 475 000
26 850 000
93 375 000
525 000
51 150 000
900 000
600 000
2 025 000
150 000
8 850 000
600 000
142 050 000
7 575 000
9 900 000
14 325 000
1 650 000
2 775 000
2 625 000
10 350 000
350 850 000
865 125 000

1 147 275 000
53 850 000
195 750 000
2 057 175 000
8 625 000
141 675 000
726 825 000
842 250 000
102 825 000
1 035 900 000
8 475 000
5 550 000
18 750 000
12 525 000
82 500 000
5 325 000
1 061 025 000
153 750 000
92 625 000
82 200 000
15 300 000
25 950 000
72 750 000
266 850 000
1 766 100 000
9 981 825 000

1 132 980 000
281 456 667
751 886 000
9 451 381 000
32 106 000
897 770 000
4 571 090 000
7 575 510 000
657 675 000
5 511 310 000
63 280 000
27 868 667
51 188 000
160 257 000
252 283 333
18 386 667
2 220 805 000
1 065 330 000
646 871 333
841 380 000
96 658 667
95 476 667
641 720 000
1 210 952 000
8 457 364 000

2 825 190 000
527 080 000
1 928 917 000
21 696 270 000
51 379 333
1 646 135 000
7 841 620 000
16 112 960 000
1 179 773 000
13 338 450 000
80 204 000
63 588 000
113 443 333
220 670 000
487 954 667
29 386 667
4 599 995 000
2 289 350 000
1 213 073 333
1 319 570 000
170 330 667
210 905 333
1 471 320 000
2 788 731 000
16 774 645 000
46 712 986 001 98 980 941 333

1 132 980 000
263 540 000
751 886 000
9 451 381 000
25 689 667
823 067 500
3 920 810 000
7 575 510 000
589 886 500
5 511 310 000
40 102 000
27 868 667
51 188 000
110 335 000
243 977 334
14 693 334
2 220 805 000
1 065 330 000
606 536 667
659 785 000
85 165 334
95 476 667
641 720 000
1 210 952 000
8 387 322 500
45 507 318 170

3 

In accordance with Council Decision No 2000/597; if the VAT base of a Member State exceeds 50 % 
of GNI, then the VAT base of this Member State is capped at 50 % of GNI. For the PDAB 8/2004, 13 
Member States will have their VAT base capped at 50 % of GNI: the Czech Republic, Estonia, Greece, 
Spain,  Ireland,  Cyprus,  Luxembourg,  Hungary,  Malta,  Poland,  Portugal,  Slovenia  and  the  United 
Kingdom. 

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3. 

CORRECTION  OF  BUDGETARY  IMBALANCES  IN  FAVOUR  OF  THE  UNITED  KINGDOM 
(2000 AND 2003) 

The  correction  of  budgetary  imbalances  in  favour  of  the  UK  to  be  budgeted  in  the 
present  PDAB  concerns  two  years  (2000  and  2003).  As  the  UK  correction  of  a 
certain year is to be financed in the following year, all 25 Member States participate 
in the financing of the 2003 correction. The financing of the 2000 correction does, on 
the other hand, only concern the 15 countries that were Member States in 2001. 

The 2003 correction is subject to the rules of the new Council Decision on the system 
of  the  European  Communities’  own  resources  (2000/597/EC,  Euratom)4  and  its 
accompanying working document5 (“The Calculation Method”), whereas the rules of 
the previous Own resources Decision6 and its accompanying working document7 still 
apply to the 2000 correction. 

The new “Calculation Method” neutralises the net gains (the “windfall gains”) of the 
UK  that  result  from  the  increase  in  the  percentage  of  traditional  own  resources 
(TOR) retained by Member States. Adjustments are also foreseen as a consequence 
of the present as well as future enlargements of the Union. 

Furthermore,  according  to  the  new  Own  Resources  Decision  the  share  of  Austria, 
Germany,  the  Netherlands  and  Sweden  in  the  financing  of  the  UK  correction  is 
reduced to one fourth of their normal share. The reduction is financed by the other 
Member  States,  excluding  the  UK.  The  new  financing  rules  consequently  have  an 
impact on the so-called frozen rate. 

Since  the  two  corrections  to  be  budgeted  in  this  PDAB  are  financed  according  to 
different rules and by different Member States, two frozen rates consequently have to 
be calculated (presented after table 1 in part A of the general statement of revenue). 
The  resulting  uniform  rate  of  call  of  VAT  is  the  difference  between  the  maximum 
rate of call (0.50 % of the capped VAT base) and the sum of the two frozen rates. 

3.1. 

Calculation of the corrections 

According to the “Calculation Method” the Commission shall propose an update of 
the  provisional  estimate  of  the  correction  if  it  has  ground  to  believe  that  the  initial 
calculation will differ significantly from the definitive calculation of the correction. 
In the present PDAB it is proposed that the 2003 correction, previously entered in the 

4 
5 

6 
7 

OJ L 253, 7.10.2000, p. 42. 
Commission  working  document  on  calculation,  financing,  payment  and  entry  in  the  budget  of  the 
correction of budgetary imbalances in accordance with Articles 4 and 5 of the Council Decision on the 
system of the European Communities’ own resources, Council of the European Union, 10646/00 ADD 
2, 21 September 2000. 
OJ L 293, 12.11.1994, p. 9. 
Method  of  calculation,  financing,  payment  and  entry  in  the  budget  of  the  correction  of  budgetary 
imbalances in accordance with Articles 4 and 5 of the Council Decision on the system of the European 
Communities’ own resources, Council of the European Union, 5455/94, 9 March 1994. 

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initial  budget  20048,  be  updated.  Furthermore,  the  result  of  the  final  calculation  of 
the 2000 correction and its financing is also budgeted in this PDAB. 

3.1.1.  Update of the correction for 2003 

The current estimate does differ significantly compared to the estimate of the 2003 
correction  entered  in  the  budget  2004.  An  update  of  the  2003  correction,  to  be 
inserted in the present PDAB, is therefore proposed. 

The following table summarises the changes compared to the estimate entered in the 
budget 2004 (rounded figure). 

 Table 1 

BUDGET 2004 

PDAB 8/2004 

DIFFERENCE 

UK correction 2003 

(1) 

(2) 

(3) = (2) - (1) 

1. Percentage share of the UK 

in the total sum of uncapped VAT bases 

2. Percentage share of the UK 

in total allocated expenditure 

3. (1) – (2) 

19.27 % 

18.50 % 

- 0.77 %

8.88 % 

7.68 % 

 -1.21 %

10.38 % 

10.82 % 

0.44 % 

4. Total allocated expenditure 

78 012 899 288 

82 025 811 437 

4 012 912 148

5. (3) x (4) 

8 101 226 495 

8 875 351 609 

774 125 114 

6. Original amount of the UK rebate = 0.66 x (5) 

5 346 809 487 

5 857 732 062 

510 922 575 

7. UK advantage 

620 520 210 

447 826 885 

-172 693 325

8. Core UK rebate = (6)–(7) 

4 726 289 277 

5 409 905 177 

683 615 900 

9. TOR windfall gains 

66 539 370 

18 346 139 

-48 193 232 

10. Amount of the UK correction = (8) – (9) 

4 659 749 907 

5 391 559 038 

731 809 132 

Table 1 shows that, as a result of these changes, the updated figure for the 2003 UK 
correction  is  approximately  € 731.8 million  higher  compared  to  the  previously 
budgeted amount. 

The  difference  is  due  to  the  combined  effect  of  five  factors,  which  could  be 
quantified as follows: 

•  The  decrease  in  the  UK’s  share  of  European  Union  expenditure  increases  the 

correction by around € 622.3 million. 

•  The increase in total expenditure allocated to the Member States compared to the 

previous estimate increases the correction by around € 286.6 million. 

•  The  decrease  in  the  so-called  UK  advantage  increases  the  correction  by  around 
€ 172.7 million.  The  “advantage”  is  the  benefit  that  the  UK  derives  from  the 
current  own  resources  system  as  compared  to  the  previous  ones  (due  to  the 
introduction of the GNP/GNI resource and the capping of the VAT bases). 

8  

The same amount was entered in the AB 1/2004. 

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•  The  decrease  in  the  so-called  TOR  windfall  gains  (see  third  paragraph  of  the 
introduction to the UK correction above) increases the correction by around € 48.2 
million. 

•  The increase in the UK’s share of European Union revenue (measured as its share 
in the total EU uncapped VAT base) decreases the correction by around € 397.9 
million. 

The revised estimate for the UK correction for the year 2003 consequently amounts 
to € 5 391 559 038, which corresponds to an increase by € 731 809 132 as compared 
to the first provisional estimate entered in the 2004 budget. 

3.1.2.  Final calculation of the correction for 2000 

The  result  of  the  final  calculation  of  the  correction  for  2000  amounts  to 
€ 4 132 577 623,  i.e.  a  decrease  of  € 293 991 119  as  compared  to  the  previously 
budgeted amount in the supplementary and amending budget (SAB) 3/2001. 

The  following  table  summarises  the  changes  compared  to  the  provisional  estimate 
entered in the SAB 3/2001. 

 Table 2 

SAB 3/2001 

PDAB 8/2004 

Difference 

UK correction 2000 

(1) 

(2) 

(3) = (2) - (1) 

 1.  UK's share of uncapped VAT payments 

 2.  UK's share of allocated expenditure 

 3.  (1) - (2)  

 4.  Total allocated expenditure 

 5.  (3) x ( 4) 

 6.  0.66 x (5) 

 7.  UK advantage 

19.41 % 

10.19 % 

9.22 % 

18.71 % 

10.43 % 

8.28 % 

-0.70 % 

0.24 % 

-0.94 % 

72 690 934 529 

74 700 969 031 

2 010 034 502 

6 701 173 504 

6 183 698 001 

-517 475 503 

4 422 774 513 

4 081 240 681 

-341 533 832 

-3 794 230 

-51 336 943 

-47 542 713 

 8.  Reference compensation = (6) - (7) 

4 426 568 742 

4 132 577 623 

-293 991 119 

The  difference  relative  to  the  previously  budgeted  amount  is  due  to  the  combined 
effect of four factors, which could be quantified as follows: 

•  The decrease in the UK’s share of European Union revenue (measured as its share 
in  the  total  EU  uncapped  VAT  base)  decreases  the  correction  by  around 
€ 336.6 million. 

•  The  increase  in  the  UK’s  share  of  European  Union  expenditure  decreases  the 

correction by around € 114.7 million. 

•  The  increase  in  total  expenditure  allocated  to  the  Member  States  increases  the 

correction by around € 109.8 million. 

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•  The  decrease  in  the  so-called  UK  advantage  increases  the  correction  by  around 
€ 47.5 million.  The  “advantage”  is  the  benefit9  that  the  UK  derives  from  the 
current  own  resources  system  as  compared  to  the  previous  ones  (due  to  the 
introduction of the GNP/GNI resource and the capping of the VAT bases). 

3.2. 

Entry in the 2004 budget of the updated estimate for 2003 and the final amount 
of the 2000 correction 

3.2.1.  Amount to be budgeted (chapter 15) 

The total amount of the UK corrections to be budgeted in the present PDAB 8/2004 
is the sum of: 

•  The total amount of the revised estimate for the 2003 correction (€ 5 391 559 038, 

in replacement of the € 4 659 749 907 budgeted in the Budget 2004), and 

•  The  difference  between  the  final  amount  of  the  2000  correction  and  the  amount 

previously budgeted (in the SAB 3/2001). 

The amount to be entered in the present PDAB is therefore equal to: 

€ 5 391 559 038 + (- € 293 991 119) = € 5 097 567 919. 

3.2.2.  Financing of the corrections to be budgeted (chapter 15) 

According  to  the  “Calculation  Method”  the  correction  for  year  n  shall  be  financed 
according to the GNP/GNI10 key of year n + 1. 

The total amount of the revised estimate for 2003 is therefore financed according to 
the revised GNI key of the present PDAB and the result is budgeted in chapter 15. 

Concerning the final correction for 2000, the 1994 “Calculation Method” states that 
in addition to the final calculation of the amount of the UK correction, a definitive 
calculation  should  also  be  made  for  the  financing.  The  final  correction  for  2000  is 
therefore budgeted in two steps. The difference between the final amount of the 2000 
correction  and  the  amount  previously  budgeted  (in  the  SAB  3/2001)  is  entered  in 
chapter  15  according  to  the  GNI  key  of  the  present  PDAB.  The  entire  financing  is 
then  recalculated  according  to  the  final  GNP  and  VAT  bases  of  the  year  2000  and 
compared  with  the  payments  already  entered  in  the  present  as  well  as  the  previous 
budgets. The difference per Member State is entered in chapter 35 (see below Result 
of  the  definitive  calculation  of  the  financing  of  the  2000  correction  –  chapter  35). 
The  definitive  calculation  of  the  2000  correction  is  an  adjustment  of  the  previous 
estimate budgeted and financed in 2001. As a consequence, it does not concern the 
10 new Member States. 

9 

10  

The  advantage  is,  just  as  in  the  previously  budgeted  estimate,  negative,  which  means  that  the 
introduction of  capped VAT and GNP  resource was  to  a disadvantage  for  the UK  in 2000.  Since  the 
"UK  advantage"  works  in  both  directions,  this  means  that  the  "disadvantage"  increases  the  UK 
correction. 
GNI has replaced the concept of GNP in the area of the EU budget as from the year 2002. 

EN 

11 

   EN 

 
                                                 
The  budgeting  in  chapter  15  of  the  two  different  UK  corrections  according  to  the 
GNI keys of the present PDAB is summarised below. 

Table 3 - Financing of UK corrections in chapter 15 

--- 

--- 

(1) 

-11 795 938

(3) = (1) + (2)  

-8 053 754
-53 651 236

-6 873 062
-32 740 901
-67 276 001
-4 925 874
-55 691 665

UK correction 2000a UK correction 2003 Total of chapter 15 
(2)  
 271 066 206
 50 571 316
 185 072 230
 355 741 367
 4 929 651
 157 940 375
 752 373 534
1 545 977 063
 113 194 720
1 279 773 409
 7 695 268
 6 101 026
 10 884 455
 21 172 445
 46 817 389
 2 819 539
 75 423 495
 37 537 166
 116 389 760
 126 607 709
 16 342 578
 20 235 562
 141 167 543
 45 725 232
- 5 391 559 038
0

 259 270 268 
 50 571 316 
 177 018 476 
 302 090 131 
 4 929 651 
 151 067 313 
 719 632 633 
1 478 701 062 
 108 268 846 
1 224 081 744 
 7 695 268 
 6 101 026 
 10 884 455 
 20 251 088 
 46 817 389 
 2 819 539 
 56 217 262 
 27 978 506 
 116 389 760 
 121 098 145 
 16 342 578 
 20 235 562 
 135 024 381 
 34 081 520 
- 5 097 567 919 
0 

-6 143 162
-11 643 712
293 991 119
0

-19 206 233
-9 558 660

--- 
--- 
--- 

-5 509 564

- 921 357

--- 
--- 

--- 
--- 

--- 

  BE 
  CZ 
  DK 
  DE 
EE 
EL 
ES 
FR 
IE 
IT 
  CY 
  LV 
LT 
  LU 
  HU 
  MT 
  NL 
  AT 
PL 
PT 
SI 
SK 
FI 
SE 
  UK 
  Total 

a Budgeting of the difference as compared to the amount previously budgeted in the SAB 3/2001. 

3.2.3.  Result  of  the  definitive  calculation  of  the  financing  of  the  2000  correction 

(chapter 35) 

The definitive calculation of the financing of the 2000 correction is based on the final 
amount of the correction and on the actual GNP and VAT bases of n + 1 (2001) as 
they appear at the end of n + 3 (2003). 

The amounts budgeted in chapter 35 corrects for: 

•  The  differences  as  regards  the  “direct  effect”,  i.e.  the  difference  between  what 
each  Member  State  should  pay  for  the  final  amount  of  the  2000  correction 
according to the final 2001 GNP financing key on the one hand and the amounts 
previously budgeted in respect of the 2000 correction, as well as 

•  the  differences  as  regards  the  “indirect  effect”,  i.e.  the  difference  between  the 
implicit  effect  of  the  final  amount  of  the  2000  correction  on  Member  States’ 

EN 

12 

   EN 

 
   
   
 
 
 
 
 
 
 
 
 
 
 
 
 
payments  due  to  its  impact  on  the  uniform  rate  of  VAT  (and  the  corresponding 
effects on each Member State’s VAT and GNP/GNI payments11) on the one hand 
and the implicit effects of the amounts previously budgeted in respect of the 2000 
correction. 

The budgeting of the 2000 UK correction concerns two different years: 

–  The first provisional amount was budgeted in the 2001 budget and refinanced in 

the SAB 3/2001, 

–  the difference between the final amount and the amount previously budgeted (in 
the  SAB  3/2001)  is  inserted  in  chapter  15  of  the  present  PDAB  (and  financed 
according to the current 2004 GNI key). 

The  direct  and  indirect  effect  of  the  final  amount  of  the  2000  correction  financed 
according to the definitive 2001 financing key consequently has to be compared with 
the sum of the direct and indirect effects in both of the years mentioned above. 

The results are shown in table 4. 

Table 4 - Chapter 35 – financing of the 2000 UK correction 

Direct effect 

Indirect effect 

Total  

BE 
DK 
DE 
EL 
ES 
FR 
IE 
IT 
LU 
NL 
AT 
PT 
FI 
SE 
UK 

  Total 

(1) 
-5 021 431 
-1 927 781 
-10 875 821 
 391 383 
6 524 407 
18 551 727 
 17 940 
2 338 574 
75 720 
-4 572 989 
-2 383 418 
401 845 
-511 933 
-3 008 223 
0 
0 

(2) 
1 942 524 
-14 363 142 
60 109 713 
-1 994 710 
-9 993 012 
-1 915 945 
-1 570 409 
-6 902 994 
-309 133 
-4 598 575 
-226 737 
-1 803 544 
-1 723 714 
-873 471 
-15 776 850 
0 

(3) = (1) + (2) 
-3 078 908 
-16 290 924 
49 233 892 
-1 603 327 
-3 468 605 
16 635 782 
-1 552 469 
-4 564 420 
-233 413 
-9 171 563 
-2 610 155 
-1 401 699 
-2 235 647 
-3 881 694 
-15 776 850 
0 

11 

Using the 2001 VAT and GNP bases as known at the end of n + 3 (2003). 

EN 

13 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                 
The  direct  and  indirect  effects  of  the  final  amount  of  the  2000  correction  financed 
according to the definitive financing keys of n + 1 and the direct and indirect effects 
of the amounts budgeted in respect of the 2000 UK correction in the SAB 3/2001 and 
in chapter 15 of the present PDAB are compared in table 5. 

Table 5 

Overall summary : final financing of the 2000 UK correction 

FINAL 2000 
CORRECTION 
(including the 
indirect effect) 

DIRECT AND INDIRECT EFFECTS OF: 

BALANCES TO BE 
BUDGETED 

SAB 3/2001 
(Chapter 15) 

PDAB 8/2004 
(Chapter 15) 

Total previous effects 

PDAB 8/2004 
Chapter 35 

BE 

DK 

DE 

EL 

ES 

FR 

IE 

IT 

LU 

NL 

AT 

PT 

FI 

SE 
UK12 

TOTAL 

(1) 

(2) 

(3) 

(4) = (2)+(3) 

(5) = (1)-(4) 

190 354 637 

206 734 627 

-13 301 082 

193 433 545 

-3 078 908 

114 643 590 

140 215 947 

-9 281 433 

130 934 514 

-16 290 924 

799 578 317 

808 624 054 

-58 279 629 

750 344 425 

49 233 892 

78 586 550 

86 435 581 

-6 245 704 

80 189 877 

-1 603 327 

385 122 767 

418 343 754 

-29 752 382 

388 591 372 

-3 468 605 

898 906 909 

947 847 400 

-65 576 273 

882 271 127 

16 635 782 

63 404 153 

69 432 872 

-4 476 251 

64 956 622 

-1 552 469 

935 053 577 

1 000 917 963 

-61 299 967 

939 617 996 

-4 564 420 

12 381 266 

13 451 936 

-837 258 

12 614 678 

-233 413 

255 218 893 

282 574 817 

-18 184 361 

264 390 457 

-9 171 563 

135 731 529 

147 760 489 

-9 418 806 

138 341 683 

-2 610 155 

72 110 820 

78 519 182 

-5 006 663 

73 512 519 

-1 401 699 

97 798 260 

106 483 738 

-6 449 831 

100 033 907 

-2 235 647 

163 292 585 

179 448 744 

-12 274 465 

167 174 279 

-3 881 694 

-4 202 183 852 

-4 486 791 106 

300 384 104 

-4 186 407 002 

-15 776 850 

0 

0 

0 

0 

0 

12 

The indirect effect of the UK rebate affects all Member States’ VAT and GNP/GNI payments, including 
the UK. The amounts indicated for the UK corresponds to the sum of the indirect effect and the amount 
of the rebate budgeted in the year in question. 

EN 

14 

   EN