"There will a phasing out on the one side and a phasing in on the other to take account of the political facts of life," EU Budget Commissioner Michaele Schreyer told a news conference.
Under the proposed new system, all countries that make net payments of more than 0.35 percent of their gross national income to EU coffers would get a refund of two-thirds of the excess, up to a total limit of 7.5 billion euros.
That would mean Britain's current 4.6 billion euro annual cheque back from Brussels would eventually be more than halved, while Germany, the Netherlands and Sweden would receive refunds for the first time.
Britain has said it will oppose any attempt to abolish its exclusive rebate and pointed to the fact that each member state has a veto on the funding of the EU budget.
Schreyer said her proposal had been amended at the last minute at the request of the two British members of the EU executive to allow for Britain to receive additional payments for a further four years so that it would "fly politically".
A special rebate for Britain, won by then Prime Minister Margaret Thatcher in 1984, was no longer justified because of the country's "wonderful, magnificent economic development" in the last 20 years, and because EU spending was being redirected towards poorer new member states in Eastern Europe, she said.
All member states, including the poorest, would be required to contribute to the refund system. Under the existing system Britain is exempted from contributing to its rebate.
Schreyer said no vote was taken in the 30-member EU executive but she acknowledged the two British commissioners, Neil Kinnock and Chris Patten, had been unable to support the proposal even after it was amended at their request.