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The perspective EU-MFF is over €2.0 trillion; it consists of existing EU’s MFF for 2021-2027 of €1.2 trillion topped up by about €800 billion in the NextGenerationEU recovery program for the years 2021-2026. The new MFF is intended to comprehensively modernise the budget’s structural positions and prepare the EU member states for new tasks and challenges.
Background
In July 2025, the Commission presented its proposal for an ambitious and dynamic Multiannual Financial Framework (“MFF”) amounting to almost € 2 trillion (or 1.26% of the EU’s gross national income on average between 2028 and 2034). This framework will equip European states with a long-term investment budget matching the EU’s ambitions to be an independent, prosperous, secure and thriving community over the coming decade.
More in: https://ec.europa.eu/commission/presscorner/detail/en/ip_25_1847
The key features of the new MFF include:
= More flexibility across the budget, so European states have the capacity to act and react fast when circumstances change unexpectedly or when new policy priorities need to be addressed;
= Simpler, more streamlined and harmonised EU financial programs, so that citizens and companies can easily find and access funding opportunities;
= A budget tailored to local needs, with National and Regional Partnership Plans for investments and reforms, for targeted impact where it matters most and ensuring a faster and more flexible support for more economic, social and territorial cohesion across our Union;
= A powerful competitiveness boost, for Europe to secure supply chains, scale-up innovation and lead the global race for clean and smart technology;
A balanced package of new own resources that ensures adequate revenues for our priorities while minimising pressure on national public finances.
Thus, in September 2025, the Commission adopted a second package of sectoral proposals, completing the framework for the next long-term EU budget during 2028-2034.
Source: https://commission.europa.eu/strategy-and-policy/eu-budget/long-term-eu-budget/eu-budget-2028-2034_enhttps://commission.europa.eu/strategy-and-policy/eu-budget/long-term-eu-budget/eu-budget-2028-2034_en
The perspective MFF-budget is over €2.0 trillion; including the EU’s mid-term (2021-2027) budget of €1.2 trillion and about €800 billion in the NextGenerationEU recovery instruments during 2021-2026. This is a significant increase compared to the current MFF-budget of €1.211 trillion for 2021-2027.
General reference: https://commission.europa.eu/strategy-and-policy/eu-budget/long-term-eu-budget/2021-2027_en; and in: https://commission.europa.eu/strategy-and-policy/eu-budget/motion/today_en
Discussions among the EU member states
The EU’s family is split between so-called frugal member states, i.e. Germany, Austria, the Netherlands, Denmark and others, that want to slash several hundred billion euros from the nearly €2 trillion present draft proposal; the so-called “rival coalition” of southern and eastern countries (the “Friends of Cohesion”) is fiercely opposing any cuts. The present expectation is to slash the multi-year budget – Multiannual Financial Framework, MFF – by about €100-200 billion.
The EU-27 governments expect the proposed size of the bloc’s next seven-year budget to be slashed by €100 billion to €200 billion from the previous plan announced in June. Some governments are rushing to secure a deal among themselves before national elections in France, Poland and Italy in 2027 threaten to derail the negotiations.
The so-called frugal states call for budget savings; the idea that has ignited fears among the Friends of Cohesion. The 17 countries — including heavyweights Italy, Spain and Poland — issued a joint statement last week opposing cuts to agriculture and cohesion.
In a concession to this camp, Ireland is expected to propose budget savings in other policy areas. Governments are bracing for major reductions to the Global Europe fund, the EU’s €200 billion pot of development aid and external relations cash, and the €410 billion European Competitiveness Fund to boost the bloc’s industrial capacity.
More in: https://www.politico.eu/article/17-countries-join-forces-to-oppose-eu-budget-cuts/
“Preserving” bloc
The 17-states’ block believe that the overall funding for Cohesion Policy and the CAP must be preserved in the next MFF; they include: Bulgaria, Croatia, Cyprus, Czechia, Estonia, Greece, Hungary, Italy, Latvia, Lithuania, Malta, Poland, Portugal, Romania, Slovakia, Slovenia and Spain. The 17 states also renewed calls to delay repayments of post-Covid debt that was expected to cost €25 billion per year and opposed budget discounts to wealthier countries, known as rebates.
One of the most sensitive issues involves introducing new EU-wide taxes, known as own resources, to finance the budget. The Commission proposed five new levies that are estimated to generate €66 billion per year. The tax package is strongly supported by France, but individual proposals have been opposed by several national governments who fear that they will be disproportionately affected by the levies.
Cuts to the EU-wide administrative costs, with €118 billion earmarked for the EU’s institutions and staff, are also popular among EU governments, though they will yield fewer savings. However, frugals have warned against shielding agriculture and cohesion from a smaller budget; they argue instead that more money should be steered away from traditional priorities towards new challenges such as defense and competitiveness.
Taxation issues
Another sensitive issue is EU-wide taxes, known as “own resources”, to finance the budget and reduce national contributions. In 2025, the European Commission proposed five new levies that are expected to generate €66 billion per year. During negotiations, governments opposed levies that would overwhelmingly affect their economies.
Several European governments lobbied Ireland to remove a corporate tax, known as CORE, that is unpopular across the bloc. But Dublin is expected to refrain from doing so, and keep the Commission’s five levies in the negobox; the latter reflects the latest budget-numbers, dubbed as the “negobox”, because it gives governments something to negotiate on, and signal early whether an agreement is possible by the end of the year.
To make CORE more palatable, Dublin might exempt small and medium enterprises from the scope of the levy. It could also make tweaks to a tobacco levy that is opposed by many.
Instead, the European Parliament’s proposed taxes on digital levies, online gambling and crypto firms are expected to be left out entirely from the negobox.
Reference and citations from: https://www.politico.eu/article/eu-countries-smaller-budget-proposal/
A new European Competitiveness Fund, worth € 409 billion, will invest in strategic technologies, to benefit the entire Single Market, as recommended in the Letta and Draghi Reports. The Fund, operating under one rulebook, and offering a single gateway to funding applicants, will simplify and accelerate EU funding and catalyse private and public investment in such spheres as clean transition and decarbonization; digital transition; health, biotech, agriculture and bioeconomy; defence, and space.
In close connection with the European Competitiveness Fund, the renowned EU research framework, with its flagship Horizon Europe worth €175 billion will continue to finance world-class innovation. Horizon Europe and the Competitiveness Fund will offer support for the entire investment journey of a project (from conception phase to scale-up) and reduce both the cost for potential beneficiaries and the time for disbursement.
More on the website: https://commission.europa.eu/strategy-and-policy/eu-budget_en
Foster education and democratic values
Stepping up investment in skills is fundamental to help EU students and workers embrace opportunities. At the same time, investing in people means supporting a vibrant civic space and protecting artistic and cultural freedom. The long-term budget will continue to invest in the areas of skills, culture, media and values. A reinforced Erasmus+ program will be the backbone of the Union of Skills. Education mobility, solidarity and inclusiveness will remain the core of the program. A strong AgoraEU program will promote shared values, including democracy, equality and the rule of law and support the European cultural diversity, its audiovisual and creative sectors, media freedom and civil society involvement.
About 14 percent of the National allocations will have to finance reforms and investments that enhance skills, fight poverty, promote social inclusion and foster rural areas.
More in: https://op.europa.eu/en/publication-detail/-/publication/35eb128b-d7d1-11f0-8da2-01aa75ed71a1/language-en
Five new “own resources” to match the EU-wide ambition
To give itself the means to act, the EU-27 must also equip itself with a modern and diversified revenue stream. In turn, this will create means to fund its priorities while repaying what the EU has borrowed under NextGenerationEU, and limiting the national contributions to the EU budget.
To that end, the Commission presents five new own resources:
= EU Emissions Trading System (ETS): targeted adjustment of the revenues generated from ETS1 go to the EU budget. Expected to generate around €9.6 billion annually, on average.
= Carbon border adjustment mechanism (CBAM): targeted adjustment of the revenues generated from CBAM to the EU budget; expected to generate around €1.4 billion annually, on average.
= An own resource based on non-collected e-waste through the application of a uniform rate to the weight of non-collected e-waste. Expected to generate around €15 billion annually, on average;
= A tobacco excise duty own resource, based on the application of a rate on the Member State-specific minimum excise duty rate levied on tobacco products. Expected to generate around €11.2 billion annually, on average;
= A Corporate Resource for Europe (CORE), amounting to an annual lump-sum contribution from companies, other than small and medium-sized companies, operating and selling in the EU with a net annual turnover of at least €100 million. Expected to generate around €6.8 billion annually, on average.
Source: https://op.europa.eu/en/publication-detail/-/publication/020610d8-d707-11f0-8da2-01aa75ed71a1/language-en?WT.mc_id=Searchresult&WT.ria_c=55576&WT.ria_f=9125&WT.ria_ev=search&WT.URL=https%3A%2F%2Fcommission.europa.eu%2F
Conclusion
The most vital issues, however, are about the EU-wide governance: in the present form, the MFF visualise possible tensions among EU institutions which are involved both in the political economy and the budgetary processes. These issues, as some advisers acknowledge, “go far beyond the traditional conflicts” between the net contributors and net recipients in the MFF structures.
Thus, e.g. some concerns appear about the “centralisation of decision-making” and de facto “weakening” of the legislature branch in governance and discussions about the “budgetary flexibility”. The German Institute for International and Security Affairs suggests that “placing decisions about the budgetary allocation and reallocation in the hands of a single EU institution is undoubtedly the fastest and most efficient option, and could significantly reduce the political and financial transaction costs”.
However, generally, the EU-wide main politico-economic and executive governance’s center (the Commission) has always had “greater interest in budgetary flexibility, while the legislative branch usually attaches importance to extensive and timely involvement in setting spending priorities”. Hence, the “budgetary accountability” would grant “the legislature the political influence”.
Source and citations from: https://www.swp-berlin.org/en/publication/the-eus-multiannual-financial-framework-for-2028-2034-new-conflicts-of-interest