British rebate

Fontainebleau castle (Photo:

British rebate

Britain has a special rebate on their EU budget contribution.

The European Summit in Fontainebleu in 1984 agreed upon a special refund (rebate) for Britain from the then  Community budget. British Prime Minister Margaret Thatcher said she wanted "her money" back - and she got it.

The British rebate is fixed every year as a reduction in her VAT contribution for the following year. Britain is one of the big net payers to the EU budget payingeach year  more than they receive.

The rebate continued after the enlargement of the EU with ten new countries in 2004. The poorer member countries now pay their share of the British rebate. During the accession negotiations Poland requested not to have to co-finance the rebate for 2003. This request was refused.

The rebate was seen as compensation to the UK for the Common Agricultural Policy which is expensive for British tax payers and consumers and from which the UK receives only a small benefit , as the UK is a major net importer of food rather than an exporter.

The European Parliament has no influence over the income components of the budget - only over expenditure.