The European Commission wants EU countries to increase their contributions from 1.1 to 1.26 percent of their gross national income. This is intended to finance a budget of over 1.8 trillion euros. According to the proposal, new European taxes will also be introduced, mainly targeting large companies. The revenue from these taxes is meant to partly supplement the national contributions.
A significant portion of the additional funding is allocated for defense and security. The Commission points to an increased geopolitical Russian threat and wants the EU to become more self-sufficient militarily. For the first time, the budget includes structural defense expenditures, such as joint procurement of military equipment and support for the arms industry.
Additionally, extra money will be allocated for economic innovation and strategic investments. With simplified financing lines, the Commission aims to respond more quickly to industrial challenges. Existing EU funds will be merged into larger 'national envelopes,' giving EU countries more freedom to decide independently how to allocate the money. Critics argue that such re-nationalization leads to less common European policy.
Opposite these expansions is a substantial reduction in the agricultural budget. The European Commission proposes to cut tens of billions of euros from subsidies to large agricultural enterprises. This will reduce agriculture’s share of total EU spending to its lowest level ever. However, there will still be significant 'farm money' for income support to small agricultural businesses and young farmers.
Farming organizations have reacted indignantly to the cuts. Protests have been announced in multiple countries. They see the proposal as a direct threat to their income and point to rising costs for sustainability and food production. According to one source, consultations about nationwide demonstrations are already underway in France.
Resistance is also growing in the European Parliament. Multiple political groups have stated they will not accept the proposal in its current form. They criticize the lack of balance between strategic priorities and traditional European core sectors. Especially the way in which agriculture and regional funds are redistributed faces opposition in southern and eastern EU countries.
In the coming months, EU member states will negotiate among themselves about the proposal. At the same time, talks are ongoing between the various political groups in the European Parliament. Only when both camps reach agreement can the multiannual budget be adopted. This process is expected to take months and will certainly lead to adjustments.