IDEAS home Printed from https://ideas.repec.org/a/vrs/ijomae/v56y2020i3p193-208n4.html
   My bibliography  Save this article

Assessment of the European Commission's proposals for financing the EU budget in 2021–2027

Author

Listed:
  • Kawecka-Wyrzykowska Elżbieta

    (Collegium of World Economy, SGH Warsaw School of Economics, Warsaw, Poland)

Abstract

A major problem in all European Union (EU) budgetary negotiations is the approach of Member States in net return terms (the fair-return approach). EU members compare their contributions to the EU budget with transfers that they receive from the budget. Net payers tend to reduce the size of the budget to contribute less. Brexit has aggravated the problem of the size of revenue (due to the United Kingdom's position as a big net payer). Also, new expenditure needs have arisen (for protecting external borders and climate, innovation, etc.). To address those needs, in 2018, the Commission submitted three proposals to supplement the current resources to finance the EU budget after the expiry of the principles of the Multiannual Financial Framework (MFF) for 2014–2020 at the end of 2020. The article aims to indicate whether the Commission's proposals are good instruments for the financing of the EU budget. The assessment relies on selected criteria based on theory. It also takes account of the feasibility of the proposals. The main conclusion is that none of the proposals meets well theoretical criteria of “genuine” EU revenue. Also, for practical reasons, it will be difficult for the Member States to come to an agreement on new budgetary resources. All proposals would be relatively costly for Poland.

Suggested Citation

  • Kawecka-Wyrzykowska Elżbieta, 2020. "Assessment of the European Commission's proposals for financing the EU budget in 2021–2027," International Journal of Management and Economics, Warsaw School of Economics, Collegium of World Economy, vol. 56(3), pages 193-208, September.
    • Handle: RePEc:vrs:ijomae:v:56:y:2020:i:3:p:193-208:n:4
    DOI: 10.2478/ijme-2020-0018
    as

    Download full text from publisher

    File URL: https://doi.org/10.2478/ijme-2020-0018
    Download Restriction: no
    File URL: https://libkey.io/10.2478/ijme-2020-0018?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Margit Schratzenstaller & Alexander Krenek, 2019. "Tax-based Own Resources to Finance the EU Budget," Intereconomics: Review of European Economic Policy, Springer;ZBW - Leibniz Information Centre for Economics;Centre for European Policy Studies (CEPS), vol. 54(3), pages 171-177, May.
    2. Begg, Iain, 2009. "Fiscal federalism, subsidiarity and the EU budget review," LSE Research Online Documents on Economics 23811, London School of Economics and Political Science, LSE Library.
    3. Margit Schratzenstaller-Altzinger & Alexander Krenek & Danuše Nerudová & Marian Dobranschi, 2016. "EU Taxes as Genuine Own Resource to Finance the EU Budget – Pros, Cons and Sustainability-oriented Criteria to Evaluate Potential Tax Candidates," WIFO Studies, WIFO, number 58887.
    4. Philippe Cattoir, 2004. "Tax-based EU own resources: an assessment," Taxation Papers 1, Directorate General Taxation and Customs Union, European Commission, revised Apr 2004.
    5. Grégory Claeys & Simone Tagliapietra & Georg Zachmann, 2019. "How to make the European Green Deal work," Policy Contributions 33125, Bruegel.
    6. Cipriani, Gabriele, 2016. "Reforming the EU’s Budget Revenue: The case for a visible VAT-based resource," CEPS Papers 11979, Centre for European Policy Studies.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Angela Köppl & Stefan Schleicher & Margit Schratzenstaller-Altzinger & Karl W. Steininger, 2020. "COVID-19, Klimawandel und Konjunkturpakete," WIFO Research Briefs 1, WIFO.
    2. Veronika Solilová & Danuše Nerudová, 2018. "Výnosový potenciál společného konsolidovaného korporátního základu daně v Evropské unii [Revenue Potential of the CCCTB in the European Union]," Politická ekonomie, Prague University of Economics and Business, vol. 2018(1), pages 78-98.
    3. Margit Schratzenstaller-Altzinger, 2020. "Reformbedarf und Reformoptionen für das EU-Budget aus österreichischer Perspektive," WIFO Monatsberichte (monthly reports), WIFO, vol. 93(3), pages 177-191, March.
    4. Margit Schratzenstaller-Altzinger & Alexander Krenek, 2016. "Sustainability-oriented EU Taxes:The Example of a European Carbon-based Flight Ticket Tax," WIFO Studies, WIFO, number 58888.
    5. Alexander Krenek & Mark Sommer & Margit Schratzenstaller-Altzinger, 2020. "A WTO-compatible Border Tax Adjustment for the ETS to Finance the EU Budget," WIFO Working Papers 596, WIFO.
    6. Andrea Gebauer & Chang Woon Nam & Rüdiger Parsche, 2006. "VAT Evasion and Its Consequences for Macroeconomic Clearing in the EU," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 61(4), pages 462-487, February.
    7. Mario Pianta & Matteo Lucchese, 2020. "Rethinking the European Green Deal," Review of Radical Political Economics, Union for Radical Political Economics, vol. 52(4), pages 633-641, December.
    8. Jorge Núñez Ferrer & Jacques Le Cacheux & Giacomo Benedetto & Mathieu Saunier & Fabien Candau & Claude Emonnot & Florence Lachet-Touya & Jorgen Mortensen & Aymeric Potteau & Igor Taranic, 2016. "Study on the potential and limitations of reforming the financing of the EU budget [Perspectives et limites pour réformer le financement du budget de l’UE]," Working Papers hal-01848029, HAL.
    9. Kateryna Redko & Olena Borychenko & Anatolii Cherniavskyi & Volodymyr Saienko & Serhii Dudnikov, 2023. "Comparative Analysis of Innovative Development Strategies of Fuel and Energy Complex of Ukraine and the EU Countries: International Experience," International Journal of Energy Economics and Policy, Econjournals, vol. 13(2), pages 301-308, March.
    10. Halkos, George E. & Aslanidis, Panagiotis – Stavros C., 2023. "Sustainable energy development in an era of geopolitical multi-crisis. Applying productivity indices within institutional framework," Resources Policy, Elsevier, vol. 85(PB).
    11. Svetlana Gercheva, 2020. "The Tax-Based Own Resources and Ecological Sustainability of the EU Budget," Izvestia Journal of the Union of Scientists - Varna. Economic Sciences Series, Union of Scientists - Varna, Economic Sciences Section, vol. 9(2), pages 136-144, August.
    12. Iain Begg, 2007. "The 2008/2009 review of the EU budget: Real or cosmetic?," CESifo Forum, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 8(01), pages 45-50, April.
    13. Julia Bachtrögler-Unger & Margit Schratzenstaller & Franz Sinabell, 2021. "Der europäische COVID-19-Aufbauplan," WIFO Monatsberichte (monthly reports), WIFO, vol. 94(4), pages 321-332, April.
    14. Koasidis, Konstantinos & Marinakis, Vangelis & Nikas, Alexandros & Chira, Katerina & Flamos, Alexandros & Doukas, Haris, 2022. "Monetising behavioural change as a policy measure to support energy management in the residential sector: A case study in Greece," Energy Policy, Elsevier, vol. 161(C).
    15. Lucchese, Matteo & Pianta, Mario, 2020. "Europe’s alternative: a Green Industrial Policy for sustainability and convergence," MPRA Paper 98705, University Library of Munich, Germany.
    16. Furmankiewicz, Marek & Hewitt, Richard J. & Kazak, Jan K., 2021. "Can rural stakeholders drive the low-carbon transition? Analysis of climate-related activities planned in local development strategies in Poland," Renewable and Sustainable Energy Reviews, Elsevier, vol. 150(C).
    17. Buberger, Johannes & Kersten, Anton & Kuder, Manuel & Eckerle, Richard & Weyh, Thomas & Thiringer, Torbjörn, 2022. "Total CO2-equivalent life-cycle emissions from commercially available passenger cars," Renewable and Sustainable Energy Reviews, Elsevier, vol. 159(C).
    18. Maciej Cieslukowski & Rui Henrique Alves, 2006. "Financial Autonomy of the European Union after Enlargement," FEP Working Papers 217, Universidade do Porto, Faculdade de Economia do Porto.
    19. Spengel, Christoph & Heckemeyer, Jost Henrich & Bräutigam, Rainer & Nicolay, Katharina & Klar, Oliver & Stutzenberger, Kathrin, 2016. "The effects of tax reforms to address the debt-equity bias on the cost of capital and on effective tax rates," ZEW Expertises, ZEW - Leibniz Centre for European Economic Research, volume 65, number 148156.
    20. Alexander Krenek & Mark Sommer & Margit Schratzenstaller-Altzinger, 2019. "Sustainability-oriented Future EU Funding. A European Border Carbon Adjustment," WIFO Working Papers 587, WIFO.

    More about this item

    Keywords

    EU budget; EU Multiannual Financial Framework; own resources; EU taxes;
    All these keywords.

    JEL classification:

    • H21 - Public Economics - - Taxation, Subsidies, and Revenue - - - Efficiency; Optimal Taxation
    • H61 - Public Economics - - National Budget, Deficit, and Debt - - - Budget; Budget Systems
    • H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism
    • H87 - Public Economics - - Miscellaneous Issues - - - International Fiscal Issues; International Public Goods

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:vrs:ijomae:v:56:y:2020:i:3:p:193-208:n:4. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Peter Golla (email available below). General contact details of provider: https://www.sgh.waw.pl/kgs/en .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.