Criticism Surfaces Over EU Budget Allocation in Germany
The European Commission's proposals for the next multi-year financial framework of the EU have met with a clear rejection from the German government, primarily due to financial concerns.
The German government, as the largest contributor to the EU budget, has expressed its inability to support the Commission's proposed increase in the EU budget. Stefan Kornelius, the government spokesman, has stated that a comprehensive increase in the EU budget is not feasible at this time, given that all member states are making significant efforts to consolidate their national budgets.
The Commission's proposal, which would make the EU budget equivalent to 1.26% of the EU's Gross National Income (GNI), has been met with opposition from Germany and other member states who consider it too high. The German government argues for fiscal prudence and stability, stressing that a significant rise in the budget is unjustifiable.
One of the key points of disagreement between Germany and the Commission revolves around the revenue sources for the proposed budget. Germany objects to certain new revenue streams proposed by the Commission, such as the levy on large companies with an annual turnover over €100 million and the proposal that 15% of national tobacco tax revenues be transferred to the EU budget. The German Finance Minister has stated that these would send the wrong economic signals and burden businesses in Germany, which the government sees as unacceptable.
The Commission aims to increase budgetary flexibility to respond quickly to crises by reducing the number of funding programs and leaving some funds unallocated for emergencies. However, countries like Germany remain cautious about such increased spending without guaranteed fiscal discipline. The German government's ongoing internal debate over public finances, including the debt brake that limits new borrowing, influences its stance on the EU budget.
Despite the rejection, the EU budget, as proposed, is intended to address new priorities. The proposals include a reform approach and alignment with new priorities such as climate, digitalization, and crisis response. However, the German government demands proportionate financial commitments, rejects specific new EU revenue mechanisms seen as harmful to its economy, and insists on fiscal discipline.
In summary, the European Commission's proposed multi-year financial framework of the EU has been rejected by the German government due to concerns about the feasibility of a comprehensive increase in the EU budget. The key points of disagreement revolve around the size and financial scope of the budget, revenue sources, and spending priorities. The German government demands proportionate financial commitments, rejects specific new EU revenue mechanisms seen as harmful to its economy, and insists on fiscal discipline, while the Commission pursues a large, ambitious, and flexible budget to address EU-wide challenges.
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- The German government, as a significant stakeholder in policy-and-legislation discussions regarding the EU's financial framework, rejects the Commission's proposed budget increase, citing general-news concerns about its feasibility and potential economic impact on its economy.
- Germany's ongoing politics-focused internal debate over public finances, including the debt brake, has influenced its stance against certain revenue mechanisms proposed by the European Commission in their plan for the next multi-year financial framework.
