The European Commission has unveiled a draft for the new multiannual budget of the European Union for 2028-2034, amounting to a record €2 trillion. This budget is poised to be the largest financial plan in the EU’s history. Notably, Poland is set to be the top beneficiary, with an estimated allocation of over €123 billion, which, according to Prime Minister D. Tusk, is intended to emphasise Poland’s growing importance in the EU and be a success of his government in its European policy.

The EU budget encompasses various expenditures, ranging from agriculture and cohesion policy to digitalization, research, defense, energy, and migration. The proposed plan includes €451 billion dedicated to enhancing the competitiveness of the European economy, over €300 billion for agriculture, and €131 billion for security and defense (five times more than in the past). Additionally, substantial amounts will be allocated to emergency funds, Erasmus+, social programs, and climate change initiatives. Poland is expected to lead in securing funds for regional development, infrastructure, and energy transition.

However, the EU budget also anticipates significant changes to the financing model of the EU, which will have far-reaching implications for member states, including Poland. The European Commission plans to substantially increase the EU’s revenues by introducing new forms of taxation for citizens and businesses, effectively bypassing national parliaments. Proposed revenue sources include the CBAM (a border adjustment tax on CO₂ emissions from imported raw materials), revenues from the emissions trading system (ETS), an e-waste fee, a common levy on the profits of large corporations (CORE), and increased excise taxes on tobacco and nicotine products. Together, these mechanisms are projected to generate over €40 billion annually for the EU. While these new taxes are nominally intended to protect the climate, health, and promote tax justice, they represent a shift towards greater fiscal control over economic and social life, particularly impacting developing countries like Poland.

It is important to note that while Poland is expected to gain the most funding, it will also be one of the largest contributors to the new tax revenues. The CBAM will affect the Polish steel, cement, and fertilizer industries, while the ETS will impose burdens on the energy sector, which is still largely dependent on coal and gas. The CORE tax will ultimately be passed on to consumers despite being aimed at corporations. The increased excise taxes and environmental fees will disproportionately affect households and small businesses. This shift signifies Brussels growing its financial authority and acting as a parallel tax system to member states, without complete democratic oversight or direct citizen input. Unfortunately, the new EU budget represents a move toward greater fiscal centralization in Europe. Financing common goals should not undermine local accountability, the freedom of citizens to act, or the competitiveness of national economies. Although Poland stands to gain the most in funding, it risks becoming merely an enforcer of EU regulations financed by taxes from its citizens. The introduction of conditionality mechanisms, new EU levies, and opaque spending processes poses a legitimate threat to our fiscal sovereignty. It is crucial for Poland to advocate for the principle of subsidiarity, limit Brussels’ budgetary expansion, and ensure that funding is not simply used as a tool for political centralization.

Source, Łukasz Wojdyga, Director of the Center for Strategic

Studies Warsaw Enterprise Institute