1978 our contribution will not increase above that for 1977 by more than two-fifths of any difference between the Commission's calculation and our actual contribution in 1977. In 1979 the increase in our contribution over 1978 will be limited similarly.
95. In 1980 and subsequent years we shall be required to contribute 90 per cent of our agricultural levy and customs duty receipts and such value added tax (VAT) (not exceeding the yield of a 1 per cent VAT) as is necessary from each member country to close any gap between Community expenditure and Community revenues from levies and duties. It is not possible to make any valid estimate of the size of our levy and duty receipts in the 1980s. The outcome depends on a large number of unpredictable factors. For example, earlier estimates of our levy receipts in the mid- 1970s have already been invalidated by the recent substantial narrowing in the gap between world and Community food prices. Nor is it possible to make any reliable forecast of the future size and pattern of our trade and so of the sources of imports, on which any estimate of both levy and duty receipts must depend. Finally, it is impossible to foresee the likely size of our VAT contribution. The size of this contribution (if any) would be a function of the size of the Community budget and of aggregate receipts of levies and duties from all member countries. The gap between these two amounts would have to widen very considerably indeed if member countries were to be required to contribute the full 1 per cent of VAT. This gap is only likely to widen in this way if the enlarged Community were to spend much more on non-agricultural activities, such as industrial and regional development, in which case the United Kingdom could expect to enjoy much larger receipts.
96. Thus, in the Government's view, neither our contribution to, nor our receipts from, the Community budget in the 1980s are susceptible of valid estimation at this stage. And it is for this reason that the Community declared to us during the course of the negotiations that if unacceptable situations should arise "the very survival of the Community would demand that the institutions find equitable solutions".
The Commonwealth
97. As has been made clear, the interests of Commonwealth countries have been a major concern of Her Majesty's Government throughout the negotiations.
98. Provision has been made to safeguard New Zealand exports of dairy products by arrangements acceptable to the New Zealand Government. Both the British Government and the New Zealand Government consider that the position which will obtain on entry into the Community in respect of trade in New Zealand lamb is satisfactory.
99. For all British dependent territories with the exception of Hong Kong and Gibraltar (see paragraph 118) and for all independent Commonwealth developing countries with the exception of those in Asia, arrangements have been made which provide the opportunities of Association or in the case of the independent developing countries the alternative of a trade agreement-with the enlarged Community, thereby permitting
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