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EU heads tell Brussels to find ‘more cash’ as bloc’s finances bleed | World | News

EU heads tell Brussels to find ‘more cash’ as bloc’s finances bleed | World | News

As the European Union contends with crises such as Russia’s invasion of Ukraine and the persistent global pandemic, Belgian Prime Minister Alexander De Croo is pushing for a significant overhaul of the EU’s financial framework.

De Croo’s proposal, which addresses the limitations of national contributions, found resonance in the words of Belgian MEP Guy Verhofstadt, who emphasised the necessity to finance the EU differently through new democratically decided own resources.

Verhofstadt sees the current juncture, marked by the Belgian presidency and the upcoming EU election campaign, as an ideal time to kickstart a debate on reforms via a Convention.

He wrote on X: “Indeed, need to finance EU totally differently: new own resources democratically decided instead of contributions by [member states] and vetoes!

“The Belgian presidency plus the EU election campaign: the moment to finally start debate on such a reform…through a Convention.”

Reacting to his words, former Brexit Party MEP Martin Daubney breathed a sigh of relief for the UK.

He said: “Thank god we’re out! We’d be bled dry to fund wars that are being fought to extend the EU’s power base – as some tin-pot NATO.”

De Croo’s proposal is unfolding against the backdrop of negotiations over the EU’s 2021-2027 budget review, including funding for Ukraine. The European Commission’s initial request for an extra €66 billion faced resistance, resulting in a scaled-down agreement of €21 billion during the last European Council meeting in December.

“With every major challenge we face, the European population, even the more Eurosceptic ones, look to Europe to solve those challenges because countries alone cannot do it,” said De Croo in an interview with Politico, underscoring the EU’s increasing role as a key player in resolving global issues.

The EU’s financial resources currently stem from member countries’ contributions and customs duties on imports. Despite the introduction of a EU-wide plastic tax in 2021, generating approximately €6 billion annually, the amount pales in comparison to the bloc’s €1.2 trillion budget for 2021-2027.

As De Croo contemplates the prospect of bloc-wide taxes ahead of the June European election, concerns arise about the source of additional revenue and its potential impact on member countries. The Belgian Prime Minister refrained from specifying, sparking speculation and adding complexity to the ongoing debate.

Opposition to the proposal emerges from a coalition of countries, primarily from Northern and Eastern Europe, reluctant to shift tax collection from their capitals to Brussels. Countries like the Netherlands and the Nordics advocate for a leaner EU budget, introducing further challenges to reaching a consensus.

With Hungary set to assume the presidency in six months, their opposition to EU-wide taxes and the blockage of €50billion in aid to Ukraine create additional hurdles. The European Parliament champions EU-wide taxes on carbon emissions and multinational profits, anticipated to generate €36 billion annually by 2028, aiming for compromise during the Belgian presidency.

“The technical deadline is to get this done before the new [budget] is finalised in 2027. But the political deadline is the June 2024 election,” stressed an EU official also speaking to Politico, highlighting the urgency of addressing the financing issue to ensure the EU’s ability to navigate global challenges effectively.

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