European Commission President Ursula von der Leyen’s €2 trillion budget plan has been met with widespread disapproval. The German federal government and business associations have sharply criticised the proposed increase in budget spending and new corporate levies.
Germany rejects European Commission’s budget plan
The proposed budget allocates €590 billion from the Competitiveness, Prosperity and Security Fund and €100 billion to finance Ukraine, while agriculture spending will be cut.
Berlin will not be able to accept the EC’s proposal, government spokesman Stefan Kornelius said. According to him, a significant increase in the EU budget is impossible at a time when member states are making considerable efforts to stabilise their budgets. In addition, the additional burden on businesses provided for in the document also does not find support.
The budget sets limits on annual EU spending and how it can be used. As the strongest member state in economic terms, Germany usually contributes just under a quarter of the funds.
The additional tax on large companies with an annual turnover of more than €100 million, introduced by the European Commission to ease the burden on member states, has been criticised not only by the federal government.
The German Association of the Automotive Industry (VDA) has already stated in advance that companies in Germany and Europe are in an extremely difficult economic situation. Therefore, any tax increases or the introduction of additional levies are prohibited. A tax levied regardless of profits must be recognised as particularly harmful to economic growth. It will weaken the competitiveness of companies in the EU.
Swedish Minister for EU Affairs calls EU draft budget too large
The draft EU budget for 2028-2034 is too large, and the European Union needs a better budget, not a bigger one, according to Swedish Minister for EU Affairs Jessica Rosencrantz.
“The budget is too large,” the minister said in an interview with SVT television.
The minister added that budget negotiations are taking place in “the most serious situation for Europe since World War II,” as the European Union is threatened by a trade war with the US, as well as the conflict in Ukraine. According to Rosencrantz, the right priorities for the EU budget would be security, increasing competitiveness and supporting Ukraine.
Poland welcomes new EU budget proposal
Meanwhile, the Polish government welcomed the European Commission’s proposed budget for the period from 2028 to 2034. It also called it a success and said that Poland would continue to be the largest recipient of EU funds.
On Wednesday, the European Commission presented its draft long-term budget, officially known as the Multiannual Financial Framework (MFF). It totals almost €2 trillion, which corresponds to approximately 1.26% of the EU’s projected gross national income for the period 2028-2034.
The multiannual financial plan must be agreed upon by the participating countries and approved by the European Parliament. This process is likely to involve years of intense negotiations.
