The European Parliament has voted in favor of a significantly larger long-term EU budget, setting the stage for tough negotiations with member states—and introducing controversial new tax ideas targeting digital sectors, including crypto assets and online gambling.
The proposal, which covers the 2028–2034 financial framework, reflects growing pressure on the EU to fund new priorities such as defense, innovation, and economic competitiveness while maintaining traditional spending areas like agriculture and regional development.
Members of the European Parliament (MEPs) supported a budget worth roughly €1.94 trillion over seven years, notably higher than the European Commission’s earlier proposal of €1.76 trillion.
This increase is partly driven by the Parliament’s insistence that repayments of post-pandemic recovery debt be treated separately, rather than being cut into existing programs.
Lawmakers argue that the EU can’t meet growing demands—ranging from geopolitical tensions to green and digital transitions—without expanding its financial capacity.
To fund the expanded budget, the Parliament is backing a series of new revenue streams, often referred to as “own resources.” Among the most debated proposals are:
These additions complement existing proposals such as carbon-related levies and environmental taxes.
The idea is to reduce reliance on direct contributions from EU member states while capturing revenue from rapidly growing digital sectors.
The proposals are likely to face resistance from several fronts.
Some EU governments have historically opposed expanding the bloc’s budget, particularly when it involves higher contributions or new forms of taxation. Meanwhile, digital taxes—especially those affecting large tech firms—could trigger international tensions, particularly with the United States.
There are also concerns within the industry that new taxes on emerging sectors like crypto could hinder innovation or push activity toward less-regulated markets.
The inclusion of gambling and crypto in the tax discussion highlights how governments are increasingly looking at digital and online industries as key sources of revenue.
Both sectors have seen rapid growth in recent years, making them attractive targets for taxation. Policymakers argue that these industries benefit from cross-border digital infrastructure and should therefore contribute more directly to EU-level funding.
However, critics warn that overregulation or excessive taxation could have unintended consequences, including reduced competitiveness or the migration of users to unregulated platforms.
The European Parliament’s vote marks the beginning—not the end—of the process. Final decisions on the EU’s long-term budget require agreement between the Parliament and member states, meaning negotiations are expected to be complex and potentially lengthy.
If adopted in its current form, the plan would represent one of the most ambitious financial expansions in EU history, alongside a significant shift in how the bloc raises revenue.
For now, the message from Brussels is clear: the future EU budget won’t only be bigger but also increasingly tied to the digital economy.
