EU Budget Proposal for 2028-2034

By Lili Bayer, Andrew Gray, and Kate Abnett

BRUSSELS (Reuters) – The European Commission proposed a €2 trillion ($2.31 trillion) EU budget for 2028-2034, focusing on economic competitiveness and defense, while planning to overhaul traditional farming and regional development spending.

Commission President Ursula von der Leyen stated, “It is a budget that matches Europe’s ambition… It delivers for our citizens, our business, our partners, and our future.”

The proposal represents 1.26% of the EU’s Gross National Income, compared to 1.13% for the current budget. Most funding comes from EU member governments, but the Commission suggested ways to increase revenue, including a new tax on companies with annual turnover over €100 million in the EU.

The budget aims to support a new €451 billion European Competitiveness Fund focused on strengthening Europe’s defense industry and promoting clean technology transitions, allocating €131 billion specifically for defense and space—five times more than the current budget.

Despite shifts in funding priorities, farmers and regions will still receive substantial support—€302 billion for farmers, €218 billion for Europe’s least developed regions, and €200 billion for global programs. Additionally, the Commission proposed dedicating €100 billion for Ukraine.

QUICK CRITICISM

Critics included Dutch Finance Minister Eelco Heinen, who argued the proposed budget is excessive. Hungarian Prime Minister Viktor Orban labeled it as unfair, alleging it diverts funds from local farmers to Ukraine.

The European Parliament expressed that the proposal was insufficient, with center-right negotiator Siegfried Muresan affirming the need for adequate resources to meet new priorities.

In the complex landscape of EU budget debates, issues like budget size, funding links to political reforms, and repaying COVID recovery loans are anticipated focal points.

Kata Tutto, head of the European Committee of the Regions, criticized the proposals for potentially undermining cohesion policy by favoring centralization.

A farmers’ protest occurred in Brussels, deemed “Black Wednesday” by the influential farmers’ lobby group COPA-COGECA.

($1 = 0.8645 euros)