Opinion of the European Economic and Social Committee on the Proposal for a Council Decision on the system of the European Communities' own resources (COM(2004) 501 final — 2004/0170 (CNS))
Date: 2005-05-12
Institutions: European Economic and Social Committee
Subjects: Community budget, Member States' contribution, budget policy, budgetary equilibrium, own resources, transparency in decision-making

27.10.2005

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Official Journal of the European Union

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5.9
The Committee welcomes priority axis 5 ‘Technical
assistance’, believing the proposed eligible actions and funding
limits to be appropriate.

5.10
The EESC believes that the EFF should also clearly
provide for financial support for fishing activities in inland or
continental waters, which in some Member States of the Euro-
pean Union represent key fishing grounds. The Committee
is replaced by the words
recommends that the word ‘lakes’
‘inland waters’
in Chapter II, Article 4 point (e) and in any
other article of the Proposal for a Council Regulation.

Brussels, 11 May 2005.

5.11
The EESC gives its full support to the Fund's manage-
ment, control and monitoring systems, believing them to be
highly appropriate and necessary to the effectiveness of the
EFF.

5.12
For all the above reasons, the European Economic and
Social Committee endorses the draft Regulation on the EFF
presented by the Commission, but calls on the Commission to
take into account the comments set out in this opinion.

The President

of the European Economic and Social Committee

Anne-Marie SIGMUND

Opinion of the European Economic and Social Committee on the Proposal for a Council Decision
on the system of the European Communities' own resources

(COM(2004) 501 final — 2004/0170 (CNS))

(2005/C 267/09)

On 22 October 2004 the Council decided to consult the European Economic and Social Committee, under
Article 262 of the Treaty establishing the European Community, on the abovementioned proposal.

The Section for Economic and Monetary Union and Economic and Social Cohesion, which was responsible
for preparing the Committee's work on the subject, adopted its opinion on 15 April 2005. The rapporteur
was Mr Burani.

At its 417th plenary session, held on 12 May 2005, the European Economic and Social Committee adopted
the following opinion by 118 votes to 2 with 15 abstentions.

1. Introduction

Article 9 of the Council Decision on the system of the
1.1
European Communities' own resources (1) provides that
the
Commission should proceed to a general review of the
System of the European Communities' own resources for
2007-2013 by 1 January 2006. If necessary, the review should
be accompanied by appropriate proposals. The European
Parliament has explicitly requested a review of the criteria
for financial contributions. Consequently the Commission, in
agreement with the Council, has
submitted the present
proposal. The Commission's task in this regard was difficult
and technically complex. Moreover, it was politically sensitive
in that
it concerned relations amongst Member States and
between Member States and their citizens.

The technical part of

1.2
the document makes difficult
reading, even for those who are acquainted with the principles
the Commission should be
of public finance. Nevertheless,
given credit for having done its utmost to ensure that, at least,

the document facilitates discussion amongst specialists, and can
be understood by the decision-makers. The proposal is in fact
accompanied by a report (2) outlining the current situation and
evaluating the pros and cons of possible alternatives. A tech-
nical appendix (3) outlines the econometric aspects, providing
relevant accounting, mathematical, and economic details.

1.3
Consequently, the Committee intends to focus on the
points that directly concern the fairness of financial contribu-
tions and the mechanisms for profit and burden sharing
amongst Member States. This choice is made in the knowledge
of the fact that obscure technicalities may sometimes cloud the
economic and political
implications.
Furthermore the concept of a ‘fair’ own resources mechanism is
terms since it combines
difficult

to define in unequivocal

significance of

their

(1) OJ L 253 of 7.10.2000 p. 42

(2) COM(2004) 505 final
(3) COM(2004) 505 final vol. II

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subjective and objective factors. For instance, prosperity levels
might be measurable, whereas the indirect benefits of belonging
to the EU might not. However, the final outcome will depend
on the balance achieved when Council negotiations are
concluded — which may prove challenging.

lated on a ‘theoretical’ harmonised statistical base, which
should not, however, exceed 50 % of Gross National
Income (GNI);

The quality of the solutions will be the proof that a
1.3.1
fair balance has been struck between two principles. The
first principle concerns ‘a fair return’, i.e. each Member State
expects its own contribution to be in proportion to the benefits
accruing to it: such benefits are not all quantifiable since they
derive directly from that country's accession to the EU. The
other principle concerns solidarity since it calls for sufficient
flexibility to make greater or fewer concessions according to
the needs of the community as a whole. It should also be borne
in mind that these principles have gained general acceptance
but are interpreted according to the values of the individual.
Each government strives to protect its own finances and
knows that national public opinion often plays a pivotal role
in its decisions. Achieving a level of consensus that satisfies
the parties is contingent upon
each and everyone one of
accepting solutions inspired by a true spirit of ‘financial feder-
alism’.

2. The current situation

2.1 Own resources are a specific feature of the European
Union and one of their functions is to emphasise the autono-
mous personality of the Community. This implies that the
Community must have its own financial resources, which
are independent of its Member States. They may therefore
be defined as revenue granted to the Community to finance its
own budget, and to which it is automatically entitled without
further decisions by the national authorities.

According to the principles underlying the Community's
2.2
own resources system, as stipulated in the conclusions of the
Berlin European Council of 24 and 25 March 1999 ‘It should be
equitable, transparent, cost-effective … based on criteria which best
express each Member State's ability to contribute.’ This declaration,
which is clearly self-explanatory, has been disregarded in
different respects and on different occasions.

2.3
The Council decision to establish own resources dates
back to 21 April 1970. It was subsequently incorporated into
and amended by a decision on 24 June 1988 and finally by the
Berlin Council of 1999. At the time of writing, own resources
may be divided into the following three categories:

— traditional Own Resources (TOR): mainly from customs

duties and agricultural levies;

— GNI-based resources: a levy proportionate to the GNI of
each Member State. There is no limit on this levy for indivi-
dual Member States. However there is a ceiling that restricts
the Community's total own resources to 1.24 % of EU GNI.

In 1996, total TOR and VAT resources made up
2.3.1
In 2003, this figure had reached 38 %.
70 % of revenue.
According to Commission estimates,
this will be further
reduced to 26 % for 2004 and the current year. This gradual
downward trend explains a corresponding rise in GNI-based
resources (the so called fourth resource).

2.4
The fourth resource mechanism was amended by the
Council decision of 7 May 1985, which recognised that the
United Kingdom's quota exceeded its contributive capacity. It
was agreed that the UK would receive a rebate corresponding
its net contributions. This decision subse-
to two-thirds of
quently underwent various amendments and the Commission
considers that the mechanism has now become increasingly
complex and less transparent.

2.4.1
The decision to adjust the mechanism had already
been taken by the Fontainebleau Council of 1984, albeit
expressed in generic terms that seemed to establish a general
principle whereby ‘… 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
this
United Kingdom has remained the sole beneficiary of
correction from the year following the Fontainebleau decision
to date. The United Kingdom's average annual rebate for the
period 1997-2003 was EUR 4.6 billion. The Committee
wonders what is meant by the expression ‘at the appropriate
time’, which seems to imply a temporary provision, subject to
periodic review (which has not been the case). The Committee
also wonders whether other States may have been entitled to a
similar correction at the time.

2.4.2
The concept of ‘excessive burden’ may be attributed
in part to the fact that, at that time, the United Kingdom had
the lowest gross national income (GNI) per capita in the Euro-
pean Union (4). The European average was 100 whereas the
United Kingdom's GNP was 90.6, compared to 92.6 for Italy,
104 for France, and 109.6 for Germany. The situation has in
fact been reversed (2003 figures) and the United Kingdom now
shares
ranking with Denmark at 111.2 %,
compared to France at 104.2, Germany at 98.6 % and Italy at
97.3 %. Another point that was given due consideration was
the fact that the United Kingdom was obliged to pay contribu-
tions that were based on a very high VAT base, whereas it

the highest

— VAT-based resources: a levy — initially fixed at 1 % and
subsequently adjusted — on national VAT revenues, calcu-

(4) See table 1, page 4 of the Commission document (COM(2004) 501

fin.

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benefited relatively little from agricultural and regional policy
contributions. As a result, the United Kingdom emerged as the
largest net contributor to the Community budget. The
resulting imbalance justified a correction mechanism, which
was in fact applied.

duties, considerable resources — including financial — would
still be required to obtain the necessary statistics on which to
calculate the amounts due.

The UK rebate was and still

is borne by the other
2.4.3
Member States, in proportion to their GNP. Needless to say the
United Kingdom was excluded from this calculation. The GNP
equalisation mechanism underwent another substantial adjust-
ment in 1999, when four of the major net contributors (in
the Netherlands,
relative terms)
Austria, and Sweden) were awarded a 75 % reduction in their
contributions towards the correction. As a result of the new
contribution system, France and Italy became jointly respon-
sible for financing 52 % of the UK rebate.

to the budget

(Germany,

2.4.4
If the current system were to be maintained, estimated
developments for the 2007-2013 period would result in a para-
doxical situation, i.e. the UK rebate would rise by an average of
50 % making it
the lowest ranking net contributor and
substantially raising the burden of other Member States,
including the new members (5). The EESC also believes that the
proposal to extend the application of this mechanism to other
countries (see point 3.6) makes it necessary to amend the rules.
It has
the correction
mechanism — if confirmed as necessary (see point 3.6.4)
— must nevertheless be reviewed — as indeed the Commis-
sion intends — and should be replaced by equitable and trans-
parent solutions that comply with the Fontainebleau criteria.

therefore become

apparent

that

3. The Commission proposal: comments on the main arti-

cles

3.1
Article 2: own resources. (paragraph 1(a)) retains the
present system, with a few changes. The revenues of the first
type (TOR) — see point 2.3 — are mainly levies, premiums,
additional or compensatory amounts, Common Customs Tariff
duties and other duties in respect of trade with non-member
countries and other duties from markets in sugar. Member
States are to retain, by way of ‘collection costs’, 25 % of the
amounts due. A deduction of such proportions requires clarifi-
cation. The percentage was originally set at 10 % and subse-
quently raised to 25 % in 1999, when it was defined as a
‘collection cost’ for the first time. Needless to say, this was an
atypical correction, which mainly benefited the Netherlands
and the United Kingdom: an indication that the procedures
lack transparency.

The EESC wonders whether there is really any point
3.1.1.1
in retaining this contribution system and whether it would be
better to drastically reduce it and replace it by adjusting the
GNI rate. Furthermore, the EESC notes that the Commission
has adopted the opposite approach, basing itself on the
premise that tax revenue belongs to the European Union as a
matter of course, and that the Commission does not intend to
change this approach, particularly since most Member States
would appear to support it.

3.2
Under Article 2(1)(b), a uniform rate valid for all
Member States is to be applied to the harmonised VAT assess-
ment bases. The assessment base may not exceed a 50 %
ceiling of GNI for each Member State. The uniform rate is
fixed at 0.30 % under Article 2(4). The reduction in the rela-
tive importance of this revenue for the Community budget —
from 51.3 % in 1996 to 14 % (projected) in 2004 and 2005 —
is significant.

3.2.1
The EESC has often criticised the VAT system, which
entails far greater collection, administrative and monitoring
costs than TOR. According to OLAF, VAT is also the most
widely evaded tax and, as such, has a negative impact on the
Community budget, (which is offset by raising the burden on
GNI).

3.2.2
Yet again, the EESC finds cause to question the
logic behind retaining this levy, which the Commission
would appear to prefer even though it intends to transform it
into a real fiscal resource, as originally foreseen. It should be
possible to adjust the percentage levy on GNI so that own
resources deriving from VAT revenue are replaced by GNI
contributions. Given the
correlation between VAT
close
revenue and the size of GNI, this should not result in any
significant change in the distribution of contributions between
Member States. However, the calculation of statistics and the
collection of VAT-based contributions to the Communities'
own resources would cease. In the above-cited report on finan-
cing the European Union (see point 3.1.2), the Commission
in fact, consider abolishing VAT-based resources but
did,
decided against it.

TOR revenue is, in percentage terms of total Com-
3.1.1
munity revenues,
in constant decline, having in fact gone
down from 19 % in 1996 to 11.4 % in 2003 (the figures cited
under this point are based on a Commission report entitled
Financing the European Union (6)). Even with lower customs

(5) See Table 4 of the above-mentioned document
(6) COM(2004) 505 final

3.2.2.1
The EESC is aware of the complexities involved but
maintains that it would be worthwhile to take a closer look at
the nature and numerous shortcomings of this duty and has
already carried out several analyses of this nature. In addition
to the comments made in the preceding point, it should be
mentioned that VAT has been a ‘provisional system’
for
decades.

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3.3
Article 2(1)(c) is the most significant component of the
proposal since it provides for the application of a rate, ‘to be
determined pursuant to the budgetary procedure’, to the sum
of all the Member States' GNIs. The procedure is a specialised
matter that the Committee does not intend to comment upon.
Moreover, the EESC would stress that this levy is outstripping
other resources, and is by far the cheapest source of revenue to
administer. The Commission reiterates,
that
administrative costs are one criterion to be taken into consid-
eration, but not necessarily the main one. The EESC takes note
of this and would point out that,
in matters pertaining to
budget contributions, principles must often give way to
economic considerations.

in its report,

want a stronger Commission and ambitious programmes for
socio-economic progress, and those in favour of greater
autonomy for the Member States and consolidation policies, i.e.
endorsing the status quo or even a reduction of current
resources (unlikely). However, particular consideration should
be paid to the challenges that face the new Member States. To
a large extent, future trends will be determined by global soli-
darity and global development: concepts that are easy to
describe but much more difficult to translate into budgetary
terms.

3.4
The three sources cited above (Article 2(1)(a), (b) and (c)
constitute a mix (complemented by ‘revenue from any other
new charges introduced’ under Article 2(2)) that could vary
considerably from year to year. The Council and the Commis-
sion have,
for some time, debated whether or not this
system should be retained. The abovementioned Commission
report (7) on financing the European Union looks at ways of
identifying an optimal structure. It examines three options:
retaining the current system, adopting an exclusively GNI-based
system, and adopting a predominantly tax-based system. It is
likely that the matter will be discussed and a final conclusion
reached during the forthcoming year. The EESC hopes to be
kept abreast of developments but warns against a tendency that
i.e. an unduly technical and
has emerged in recent studies,
accountancy-based approach that overlooks
the political
aspects of decisions.

The ideas aired in the context of the ‘revenue from
3.4.1
any other new charges introduced’ cited under the preceding
point, or even as an alternative to VAT resources, included a
tax on pollutant energy sources in favour of the Community
budget but specifically earmarked for bettering the environ-
ment. The EESC is opposed to such a solution insofar as there
is no rule authorising the appropriation of contributions for
specific purposes. In addition, the international political situa-
tion excludes decisions that could have an impact on future
dynamics.

3.5
Article 3: resources and commitments. This article
establishes the ceiling for payments and commitments for
own resources at 1.24 % of total GNIs of the Member States.
The ceiling for appropriations for commitments is fixed at
1.31 % of total GNIs of the Member States. The balance should
be provided by other payments of different types. Regarding
commitments, dialogue between Member States reveals the
existence of different methods for calculating the maximum
ceiling foreseen in the financial perspectives. The outcome will
depend on the balance struck between those members who

(7) COM(2004) 505 final

3.6
Article 4(1): the generalised correction mechanism
(GCM). Article 4(1) establishes the Fontainebleau decision
concerning the United Kingdom as a general provision. The GCM
is thereby extended to all Member States to correct a nega-
tive budgetary imbalance exceeding a certain percentage of
their GNIs. No threshold has been established in the proposal
but its explanatory memorandum mentions the figure –0.35 %
of GNI. Furthermore, overall correction should not exceed
the maximum available refund volume. The Council will lay
down the implementing measures for the calculation of the
corrections and available financing in accordance with proce-
dures laid down under Article 279(2) of the EC Treaty. The
correction is calculated for each Member State on the difference
between overall payments and total amounts received and multiplying
the difference by the total allocated expenditure. The result (if posi-
tive) is multiplied by a refund rate fixed at a maximum of
66 % of total payments and, if necessary, reduced propor-
tionally to respect the maximum available refund volume.
In the final analysis, the formula is difficult to understand and
its outcome is even more difficult to verify.
If this is not
another example of lack of transparency then it is certainly
indicative of the need for simplification.

3.6.1
The EESC notes that the questions raised in point
2.4.1 and the proposals mentioned in point 2.4.4 have in fact
been addressed insofar as an albeit justified measure, which was
applicable to only one Member State and with no clear expiry
date, has been extended to all. Moreover, the GCM has trans-
muted the concept of ‘excessive burden’ into a mathematics-
accountancy approach, which, while it has the advantage of
eliminating subjective interpretations, does not
take into
account considerations that might be described as ‘quasi-quali-
tative’ such as competitiveness, social protection levels and the
hidden economy, in addition to per capita income. It is true
that figures alone do not reflect the real situation in a country.
Nevertheless, a generalised mechanism that takes into account
extraneous assessment factors would risk introducing subjective
criteria that would be incompatible with transparency. There is
therefore no alternative to applying the GCM as it stands,
knowing that it will not always lead to optimum results.

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3.6.2
Article 4(1) has the merit of abolishing direct contri-
butions by Member States to cover ‘correction’ financing and
channelling them through the Community budget. This brings
to an end, a system that had little to do with logic or, at any
rate,
transparency. The Commission's explanatory memor-
andum is thick with calculations that are not always easy to
follow and comments that help to shed light on the scope of
the proposal for a decision. These helpful clarifications include
an explanation of how the application of a –0.35 % threshold
of GNI will generate an estimated average volume of gross
corrections of around EUR 7 billion. The Commission
believes that the application of the GCM, combined with the
amendment to the financing provisions, will mean that the
correction level within the framework of the current system will not
be at all clear.
If the system and parameters proposed are
adopted, the Commission's calculations will produce quantita-
tive results contained in comparative tables
showing the
different alternatives, which will be submitted to Member States
for assessment and decision. The EESC does not have the
resources needed to comment on this complex matter.

3.6.3
The EESC would draw attention to two considerations
that might call into question the very mechanism of the GCM.
In the first place, the mechanism is inflexible and unrest-
ricted in time. In this regard,
it is important to recall the
dangers of basing rules on current realities that could undergo
drastic changes in the future — the Stability and Growth Pact
is a case in point. In the second place,
it does not appear
feasible to impose contributions that are subsequently adjusted
through ‘correction mechanisms’ which, for the sake of trans-
parency, might be better termed as ‘reimbursements’.

3.6.4
Finally, the EESC recalls one of its recent opinions,
wherein it expresses serious reservations regarding the institu-
tionalisation of the GCM (8) and wonders whether it would not
be more appropriate to drastically alter the concept of ‘correc-
tion’ by making the GCM an integral part of the criteria for
contributions. More specifically, the same GCM parameters
should form part of contribution calculations. The Commission
has already adopted this procedure in practice and would be
well advised to formalise it, in conjunction with a clause for a
periodic review, for instance every seven years.

3.7
Article 4(2)(a): the United Kingdom correction. This
paragraph provides transitional measures whereby the United
Kingdom,
in addition to the corrections resulting from the
application of Article 4(1), will retain its rights under the
Fontainebleau decision until 2011, on a descending scale:
EUR 2 billion in 2008, EUR 1.5 billion in 2009, 1 billion in
2010 and 0.5 billion in 2011. These payments would be
decoupled from the GCM. In practice they would continue to
be financed under the current financing rules,
the
United Kingdom does not participate in the financing, and the

i.e.

(8) EESC opinion on the Communication from the Commission to the
- Building our common
the enlarged

Council and the European Parliament
future: Policy challenges and budgetary means of
Union 2007-2013 OJ C 74 of 23.03.2005 p 32, point 5.5.1.

share of Germany, the Netherlands, Austria and Sweden is
restricted to 25 % of their normal share (see points 2.4.3 and
2.4.4) The Commission considers that phasing in these new
measures in four gradual steps will alleviate the financial
impact of the GCM for the United Kingdom. In recent years
(1997-2003), the UK has received a net average rebate of
EUR 4.5 billion per annum, whereas under the GCM it should
receive an average EUR 2.1 billion a year. The transitional
measures will raise the annual average amount to EUR 3.1
billion (Fontainebleau and GCM).

3.7.1
The proposed provision is clearly a combination of
the
various elements: recognition of developments to date,
need for transparency and political expediency. It is not the
first time that derogations from the Common Rules have been
introduced. Accession treaties, both old and new, are proof of
this. It may be difficult for external observers and those not
directly involved to accept
the rules under consideration.
However the situation that we are obliged to live with could,
perhaps, persuade decision-makers to put forward balanced solu-
tions that are, above all, transparent and well substantiated. In this
case, the negotiators would not only have to find a compro-
mise between fair return and solidarity mentioned under
point 1.4 but also to show particular political sensitivity by
taking into account public opinion in Europe, and especially
public opinion in the new Member States.

3.8
Article 4(2)(b): phasing-in of the GCM. The rules
establishing the GCM should be phased in gradually. The
maximum refund rate of 66 % mentioned under Article 4(1)
(see point 3.6) will not become applicable until 2011. The
refund rate will be introduced at 33 % in 2008, will rise to
50 % in 2009 and 2010 and will reach its maximum rate the
following year. The Commission considers this measure neces-
sary ‘in order to offset the increased cost brought about by
the proposed top-up payments for the UK so as to limit the
overall financing cost during the transitional period’. This is a
clear indication of the difficult circumstances currently under-
lying European debate and it would be a grave error to conceal
them from the European citizen. The EESC cannot but empha-
tically reiterate its comments under point 3.7.1.

3.9
Article 5: accountancy procedures for the correc-
tion. The costs of the correction are to be distributed amongst
Member States according to each State's share in the total EU
GNI. The correction will be granted to any eligible Member
State via a reduction in its payments. The costs borne by
all Member States will be added to their payments resulting
from the application of a rate based on the sum of all the
Member State's GNIs. The EESC has no comments in this
regard: once the mechanism is in place,
its implementation
cannot be otherwise.

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3.10
Articles 6, 7 and 8: non-accountancy procedures
regarding own resources. Similarly, these rules do not invite
comment insofar as they comply with the general principles of
the earmarking of revenue for specific
public accountancy:
expenditure is not allowed, surplus to be carried over to the
following year, arrangements for collecting own resources.

3.11
Article 9: modification of own resources structure.
Under this article, if it is approved, the Commission commits
itself to presenting a genuinely tax-based own resource that
will enter into force on 1 January 2014.

3.11.1
The previously mentioned report on financing the
European Union (9), provides a detailed analysis of this issue.
Briefly, the Commission proposes to radically reduce the GNI-
based resource by substituting it with a corresponding increase
in the tax-based resource. Three alternatives may be
roughly — and inevitably simplistically — summarised as
follows: a tax on energy consumption, a VAT levy based on
actual rather than statistical receipts, corporate tax. Partially
replacing the fourth resource with a tax-based system would,
according to the Commission (point 4.1.3 of the report), have
the advantage of making the EU more ‘visible’ for citizens
and establishing a direct link with them. Under the current
system, which is predominantly based on the fourth resource,
Member States, and net contributors in particular,
tend to
judge European policies and initiatives exclusively in terms of
their own national allocations, and with little regard for the
substance of Community policies, with the risk of obscuring
their ‘value added’.

3.11.2
The EESC reiterates its previous comments regarding
the
this report, which warrants special attention. However,
EESC believes it to be at an intermediate stage and considers
that it warrants further discussion. Without wishing to discuss
the three tax proposals mentioned under the previous point
(the first of which is apparently to be discarded at
the
outset (10))
the Committee would draw attention to the
Commission's comment mentioned under the previous point,
which eminently sets out the premise for Article 9. In the
Commission's opinion,
introducing a direct ‘European’ tax
for citizens would bring the citizen closer to Europe,
whilst Europe would gain ‘visibility’. The opposite could
prove to be the case. The Commission's criticism — which
the EESC endorses — of the Member States' attitude could also
be applied, by analogy, to EU citizens.

(9) COM(2004) 505 final of 14.7.2004
(10) A tax on energy would be anachronistic in the light of the current
and expected situation. (See EESC opinion on Tax policy in the
European Union – Priorities for the years ahead, published in OJ C
48 of 21.2.2002, point 3.1.2.1.1. With regard to a tax on energy
to protect the environment, the Committee has pointed out repeat-
edly that ‘the introduction of eco-taxes must not be allowed to lead
to European firms becoming less competitive and to jobs being
lost, especially in energy-intensive sectors)’

3.11.3
The EESC notes that the Commission does not seek
to raise taxes but rather to clearly indicate what percentage of
taxes are accruable to national fiscal systems and what should
be reserved for EU financing. Nevertheless, this observation
fails to dispel the EESC's concerns. Whereas, on the one hand,
explicit reference to a ‘European tax’ could result in greater
transparency without
the
taxpayer, on the other hand, it is impossible to ignore the fact
that some citizens in various countries are still opposed to the
‘European ideal’ or, at best, are ill-informed about it. A ‘Euro-
pean tax’ could, albeit inappropriately, add to the arguments
against it.

raising the overall burden for

The preceding paragraph concludes

3.12
EESC's
comments on the Commission document. However, the EESC
wishes to contribute to any future re-analysis of this subject by
drawing the decision-making bodies' attention to some further
considerations. In the EESC's opinion, transparent and readily
applicable solutions would consist in:

the

— A gross contribution based on GNI per capita: the EESC has
already raised this point in its Opinion on the Communica-
tion from the Commission to the Council and the European
Parliament — Building our common future: Policy chal-
lenges and budgetary means of the enlarged Union 2007-
2013 (11).

— A net contribution calculated on the basis of the gross
contribution and corrected in accordance with the GCM,
which would then become an integral part of the contribu-
tion mechanism, thereby avoiding subsequent rebates and
adjustments.

An approach of this type, whilst remaining open to future
adjustments and corrections, would have the advantage of
always reflecting the prevailing situation in each country,
whilst obviating the need to revise the contribution structure.

4. Concluding comments

4.1
The EESC realises that the final decision, which will
undoubtedly be influenced by political considerations, lies with
the Member States. It is in its capacity as representative of civil
society, in other words, of those who will ultimately bear the
burden of contributions to the European budget, that the EESC
puts forward these recommendations and proposals, hoping
that they may be taken into consideration.

(11) OJ C 74 of 23.03.2005, p 32, point 5.5

27.10.2005

EN

Official Journal of the European Union

C 267/63

4.2
Civil society and, ultimately, the European citizen would
point out that the mechanism for contributions to the EU's
own resources is little-known, but more importantly, it lacks
transparency. A GCM that is designed to reimburse contribu-
tions that have already been made, at the expense of other
Member States rather than of the Community budget, would
appear even less transparent. If we genuinely intend to ‘bring
the citizen closer to Europe’, Member States must be aware of
their responsibilities in respect of this frequently reiterated and
acclaimed objective: communication must be based on clarity
and accessible language. This responsibility lies primarily with

Brussels, 12 May 2005

individual national governments rather than with the Commis-
sion. National governments alone are in a position to commu-
nicate with their citizens since they understand their mentality
and needs. Ultimately, the credibility of the European Union is
the specific responsibility of the national authorities.

If

the above-mentioned conditions are fulfilled,

4.3
the
proposal to set up a contribution system based on ‘European’
taxation might have some rational foundation. However, failing
this, the proposed mechanism seems premature, to say the
least.

The President

of the European Economic and Social Committee

Anne-Marie SIGMUND

The following amendment was defeated during the course of the discussion:

APPENDIX

Point 3.1.1.1

Delete.

Reason

There will be no change in the calculation of customs revenue or the cost of running the customs service, even if
customs duties cease to be part of the EU's own resources. As trade policy falls within EU competence, it seems only
natural that EU policy should embrace all aspects of it, including customs collection and customs revenue.

Outcome of the vote

For: 38

Against: 51

Abstentions: 18.