António Costa seeks national backing for EU-wide levies to fund budget

European Council President António Costa is pressing national governments to agree to new EU-wide levies to finance the bloc's upcoming budget. The push seeks to harness revenue linked to the global corporate tax agreement, directing fresh income straight to Brussels rather than routing it through national treasuries.

Financing the European Union is a delicate exercise in fiscal evasion. The bloc runs on a multiannual budget, but it does not have the automatic tax-raising powers of a national state. Instead, it relies on national contributions calculated from each member state's economic output, alongside customs duties and small tranches of VAT—known collectively in institutional parlance as 'own resources'. Whenever Brussels seeks to expand its spending, member states are confronted with an uncomfortable choice: either wire larger checks from their own domestic treasuries, or grant the EU new levies to raise cash directly. National capitals almost invariably loathe both options, which makes every budget negotiation an exercise in testing how long finance ministers can resist before reality intervenes.

As European Council president, Costa's job is to herd the twenty-seven heads of state and government toward consensus—a task akin to running a dinner club where everyone orders the tasting menu but nobody wants to split the bill. Taxation remains one of the few policy areas in the EU where national sovereignty is strictly preserved by the unanimity rule. That means any single capital can veto a revenue proposal, and several member states treat the prospect of giving Brussels direct revenue streams with deep suspicion. For Costa, persuading twenty-seven leaders to yield ground on taxation requires framing EU-level levies as a relief valve: a way to fund joint European commitments without forcing prime ministers to defend higher direct contributions to voters back home.

The push now enters the labyrinth of Council negotiations, where diplomats and national finance ministries will scrutinise the proposal. Because tax matters demand unanimous agreement among all member states, Costa faces an uphill battle to turn the push into an agreed fiscal settlement before the next multiannual budget framework is finalised.