Cameron refuses to pay EU surprise tax bill of $2.6b

British Prime Minister David Cameron warned Friday he would not pay an "unacceptable" bill for 2.1 billion euros ($2.6 billion) that the European Union had unexpectedly demanded from London by December 1.

UK PM unhappy about EU tax bill

British Prime Minister David Cameron gives a press conference on October 24, 2014 on the second day of a European Union summit at EU headquarters in Brussels.

"I am not paying that bill on the first of December," Cameron told reporters at an EU summit in Brussels, thumping the lectern as he spoke.
   
"If people think that is going to happen they've got another thing coming," he said. "We are not suddenly going to take out our chequebook and pay that cheque."
   
The budget bust-up raises fresh questions over Britain's vexed EU membership which Cameron has vowed to put to a referendum in 2017 if he wins a general election next May.
   
A clearly furious Cameron insisted repeatedly that Britain, one of the largest contributors to the EU budget, had been treated unacceptably, with the  2.1 billion euros demand coming virtually out of the blue from the European Commission.
   
"I first learned about this (on Thursday)," he said, "and I immediately set about finding allies such as Italy and the Netherlands," who also face back-bills.
   
Making the pill even harder to swallow for Britain, the same budget review gives struggling France a rebate of some one billion euros while economic powerhouse Germany gets nearly 800 million euros.
   
"We have asked a lot of questions (but) we have not had answers. I will go on asking those questions," Cameron said.
   
"It is not an acceptable way to behave and (the EU) should not be surprised when some of its members say it cannot continue like that and that it has got to change."
   
Asked what impact the latest exchanges could have on the 2017 vote, the prime minister said: "It hardly helps," while stressing again his belief that Britain had a role to play in a fully reformed EU.

France's response

French President Francois Hollande told David Cameron Friday that all EU states must respect the bloc's budget rules after the British leader refused to pay a huge bill from Brussels.
   
"Respect for the treaties, that is for everyone," Hollande told a press conference after a summit dominated by a demand that London pay an extra 2.1 billion euros ($2.6 billion) to Brussels because its strong economy meant it should contribute more.

Britain 'should have been prepared'

Britain should have been prepared for an EU bill of more than two billion euros that has infuriated London, European Commission President Jose Manuel Barroso said Friday.
   
"This should not have come as a surprise for member states," Barroso told reporters after Prime Minister David Cameron angrily refused to pay the backdated charges.
   
Barroso said the figure of 2.1 billion euros ($2.6 billion) is based on statistics about its economy that Britain itself gave the European Commission, the EU's executive arm.
   
The "mathematics" are based on mechanisms the member states have "agreed on unanimously," he said when asked for a reaction to Cameron's fury over the matter.
   
"We have been careful not to politicize the process we have been asked to administer," Barroso said.
   
Cameron insisted repeatedly that Britain, one of the largest contributors to the EU budget, had been treated unacceptably, with the demand coming virtually out of the blue from the European Commission.
   
The new bills are based on a revision in the way in which the economic output of EU states is measured to include previously hidden elements such as drugs and prostitution, and the overall economic situation of each country.
   
Cameron demanded an emergency meeting of finance ministers which Barroso said had been agreed to in order to provide the necessary information.




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Source: AFP


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