The European Parliament has voted in favor of a 10% increase to the EU's next long-term budget and the introduction of new revenue streams, setting up a clash with member states including Germany.

Lawmakers in Strasbourg on Tuesday voted to expand the proposed roughly €2 trillion plan for 2028–2034, backing measures that would include a digital levy on large corporations. The plans were backed by 370 EU lawmakers, while 201 were against and 84 abstained.

The parliament also wants to exclude billions in repayments linked to the EU's COVID-19 recovery fund from the budget total. Beyond a digital tax, lawmakers are pushing for new revenue sources such as levies on online gambling, an expanded carbon border mechanism, and taxes on cryptocurrency gains.

The EU's seven-year budget is always one of the bloc's most contested issues, with negotiations often stretching over years. The current proposal covers spending on defense, climate action, digitalization, and programs such as the Erasmus student exchange program.

Lead negotiator Siegfried Muresan demanded a "strong" budget, stating: "The position of the European Parliament is clear. We believe we cannot do more with less."

Germany, the largest contributor to the EU budget, has already rejected the scale of the plan and called for a smaller framework. An EU diplomat told DPA: "We need to be realistic and honest with each other: As long as national debt levels keep rising and national budgets remain tight, calls for an increase of the next EU budget don't have any credibility."

EU leaders have already clashed over the bloc's existing long-term budget. Germany and the Netherlands, part of the so-called frugal group, warned against higher spending. Chancellor Friedrich Merz rejected new debt and said the EU must set priorities, even if that means cutting spending elsewhere.

Source: www.dw.com