Costa puts EU taxes at heart of his grand budget tour

BRUSSELS — António Costa’s EU budget tour is reaching the bigger capitals, with Berlin, Warsaw and Madrid on the agenda for the coming days. The settings may change, but the main question the European Council president is asking remains the same: Can we all agree on new EU taxes to help fund the long-term budget? Introducing new EU-wide levies is crucial to lay the groundwork for a budget agreement by the end of the year, before national elections in France, Spain, Italy and Poland in 2027 threaten to disrupt the negotiations. Costa — who has been touring EU capitals to assess what each wants from the budget — will bring up the topic of taxes when he meets Polish Prime Minister Donald Tusk and German Chancellor Friedrich Merz on Wednesday. The following day, he will meet Spanish Prime Minister Pedro Sánchez in Madrid, along with Portugal’s Luís Montenegro in Lisbon. He will finish the week in Finland, meeting Prime Minister Petteri Orpo on Sunday. “Ambition cannot be realized without the right financial instruments,” Costa said on Saturday. “A budget not just about numbers, but as the ultimate political choice, a choice about our future.” The topic of new taxes — own resources, in EU-speak — was also the focus of a meeting of European ministers in Dublin last week, when the real horse-trading began over the European Commission’s €2 trillion Multiannual Financial Framework proposal for 2028-2034. Countries that pay more into the EU budget than they receive are resisting higher contributions, while governments across the bloc support increased spending on defense, security and competitiveness. That leaves new EU-level revenue streams as the most plausible way to expand the budget without directly asking national treasuries to pay more. “We cannot do more with less,” Spanish Secretary of State for Europe, Fernando Sampedro, said in Dublin, summing up the fundamental tension underpinning Costa’s tour. Search for new money Costa’s top takeaway from the trip so far? A sense of urgency. “The awareness of the leaders about the need to reach an agreement by the end of the year, that’s very, very widely shared by the leaders,” said an EU official familiar with preparations for the trip and granted anonymity to speak freely. Yet as the Council chief prepares for stops in the bloc’s heaviest economic hitters, the positions of these capitals seem intractable. Germany is among the nations that want a smaller budget pot, lower national contributions and a different balance of spending. Poland and Spain are fighting to protect spending on regions, agriculture, and fisheries, while also backing more investment in defense, security, and competitiveness. But the most important information Costa has gathered so far concerns not simply where governments stand on spending priorities, but how firmly they oppose — or are prepared to consider — proposed new EU taxes. The Irish presidency of the Council of the EU is steering the budget talks. | Nicolas Tucat/AFP via Getty Images The aim is to narrow down the options in October, when EU leaders meet for a summit in Brussels. But governments have already made clear that they dislike different elements of the five Commission and three European Parliament ideas that have been shortlisted, making it difficult to assemble a package large enough to finance the bloc’s ambitions. The Irish presidency of the Council of the EU, which is steering the budget talks, welcomed “consensus” among governments on new EU-wide levies on foreign carbon imports and electronic waste, but noted strong opposition on other tax proposals, according to a document seen by POLITICO. In preparation for a meeting on Tuesday, Ireland also asked EU ambassadors to suggest changes to the Commission’s proposals and quantify the desired total revenue from the new own resources. Establishing how much money the new resources could raise would help set a ceiling for the negotiations and define the contours of a possible deal. Withou