Brexit: U.K. could pay up to €100 billion in split

By Charles Riley

LONDON (CNNMoney) -- Will Britain be forced to pay €100 billion ($109 billion) to leave the European Union?

U.K. Brexit Secretary David Davis poured cold water on the eye-popping exit cost that was floated Wednesday, saying that the final amount paid by the country will be much lower.

"It's gone from €50 billion, to €60 billion to €100 billion," David Davis said during a radio interview. "I know that's not where we'll end up."

The size of the so-called Brexit bill is expected be a key sticking point in divorce talks between the EU and U.K.

The EU plans to demand an upfront payment of up to €100 billion, the Financial Times reported Wednesday. That figure is significantly higher than previous estimates, but the newspaper cautioned that the net cost to Britain would be reduced over the coming decades by reimbursements from the EU.

Bruegel, a think tank, has independently calculated that the initial payment by the U.K. could reach €109 billion ($119 billion). However, it estimates the net cost to Britain after repayments would end up between €25 billion ($27 billion) and €65 billion ($71 billion).

EU member states pay into the communal budget, which finances infrastructure projects, social programs, scientific research and pensions for EU bureaucrats. The bloc's budget is negotiated to cover a period of years, with the current agreement extending to 2020.

Negotiators must now determine how much Britain needs to pay in order to settle its financial commitments to the EU.

Prime Minister Theresa May officially triggered Brexit in March, but formal talks haven't started yet.

Even so, tensions between Britain and the remaining 27 member states of the EU have spiked in recent days. Divisions burst into the open following a meeting last week between May and European Commission President Jean-Claude Juncker.

The EU side reportedly described the discussions as having gone "badly" and British officials as being in a "different galaxy."

May, who is campaigning ahead of next month's U.K. general election, responded by saying she will be a "bloody difficult woman" in talks with the EU.

"The simple truth is: This is going to be a tough negotiation," Davis said Wednesday. "Nobody argues that point."

TM & © 2017 Cable News Network, Inc., a Time Warner Company. All rights reserved.

Share this article:
Are you sure you want to delete this comment?
Are you sure you want to delete this comment?