Brussels wants to take a €12bn annual slice of the EU’s emissions trading scheme (ETS) and use it to repay recovery fund debts and support vulnerable households, as the European Commission makes a pitch for fresh revenue streams from member states.
Proposals from the commission would also give it the lion’s share of the new carbon border adjustment mechanism that will tax high-polluting imports, gaining another €1bn a year in revenues. And Brussels would take a chunk of reallocated taxing rights on multinationals, proposed under the recent OECD deal, yielding it up to €4bn of extra revenue.
The package of new EU “own resources”, worth up to €17bn a year from 2026 onwards, would revolutionise the way the commission raises money, but is likely to encounter difficult negotiations with member states that will chafe at granting Brussels new revenue lines. Brussels argues the extra cash is necessary to repay the unprecedented borrowings that will be amassed under its €800bn pandemic recovery programme.